February 6, 2004



Australian Cattle On Feed Numbers To Increase


The number of cattle in Australian feedlots rose in the fourth quarter of 2003 under normal seasonal influences but is expected to surge in the current quarter, reflecting the impact of a U.S. case of bovine spongiform encephalopathy, or mad-cow disease, the Australian Lot Feeders Association said late Thursday.


The number of cattle on feed rose 6.9% in the fourth quarter to 652,094 from 609,890 in the third quarter, according to a survey issued by the association and marketing concern Meat & Livestock Australia Ltd.


Numbers on feed last quarter were down 7.7% from 706,4771 in the 2002 fourth quarter.


Sandy Maconochie, president of the association, which represents the industry, said the fourth-quarter figures are close to expectations.


"They reflect normal seasonal production patterns, market demands and the influence of an excellent supply of grain compared to the previous year," he said in a statement.


No effect from the U.S. BSE case, announced Dec. 23, is evident in the fourth-quarter figures, he said.


However, most people expect that "significant increases" in the number of cattle on feed are imminent due to the increased demand from Asian markets in the wake of the U.S. BSE situation, he said.


Japan, South Korea and many other nations banned the import of U.S. beef after the BSE news surfaced, spurring a hunt for other supply sources that naturally focused on Australia.


That said, though, feedlots considering producing cattle to "fill the gap" will need fixed price and delivery contracts to enable these placements to occur, he said.


"The wheels have yet to be put in motion," he said, adding that the extent of any increase should be revealed in the next quarterly report.


Maconochie said he was pleased by a jump in the total turnout for cattle from feedlots in 2003, rising to 2.1 million from 1.9 million in 2002.


This increase illustrates the ability of Australian feedlots not only to meet domestic market demands but also demands from major export markets, he said.


Australia exports about two-thirds of its beef production, making it a major world exporter.


About a quarter of all cattle slaughtered in Australia spend some time growing out in a feedlot before slaughter.


Just over half the number the cattle on feed in the fourth quarter were in Queensland state, while one-third were in New South Wales.


The number of cattle fed last quarter for Japan rose to 362,150 from 316,351 in the third quarter but was down a little from 365,173 in the 2002 fourth quarter.


The number of cattle fed for domestic markets barely changed in the last quarter at 245,449 compared with 245,872 in the third quarter, but was down from 270,024 in the 2002 fourth quarter.

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