February 14, 2006

Australia's beef production and exports to fall in 2006

The Australian beef industry is expected to recover from prolonged drought conditions to reach 29.4 million head in 2006, according to USDA's Feb 8 report on Australian livestock and products. This compares with an estimate of 28.1 million head for 2005.

The increase was partly due to the 3-percent reduction in slaughter as producers hold stock back from slaughter for breeding purposes.

As a result of reduced slaughter, beef production in 2006 is expected to decrease by 2 percent. However, production will be offset by improved seasonal conditions and increased carcass weights.

Similarly, beef exports are predicted to decrease by 4 percent in 2006, as a result of lower beef production. Increased competition in market shares in both Japan and the US will lead to decreased overseas demand for Australian beef.

USDA predicts Australian beef exports to Japan will decline in 2006 from the record levels of 2005. This is because the re-opening of the Japanese market to US beef will affect market share.

For the full USDA report, click here.