August 18, 2014

Australia's northern beef industry has witnessed a strong increase in live cattle exports to Vietnam, with figures showing a rise to 131,000 head, from 1,500, in just three years.

The figures, which are gathered from Meat and Livestock Australia, translate to an increase of almost 9,000% since the 2011-12 financial year. Ben Hindle, the CEO of Northern Territory Livestock Exporters Association, said the number came as a shock.

"There was a need for a market, a secondary market, but it was never known at that point how big it was going to get," he said. "Behind the scenes, there were two major exporters that have put a lot of capital investment and resource investment into Vietnam to make sure that it is a good secondary market, and a domestic for our own national market here."

Hindle adds that the 131,000 figure is made up of cattle sourced from across northern Australia.

"Vietnam whet its appetite and those numbers aren't Northern Territory bound, they're across the spectrum and across the north," he said. "From a Darwin scope, 49,000 head of cattle were exported from Darwin to Vietnam. That equates to a 200% increase from last year and provides a diversity to the market dominated by Indonesia."

In its annual projections released in January, MLA said the Vietnam market would 'taper off' in 2014 due to increased demand from Indonesia. However, record numbers of cattle were also exported to Vietnam in 2013, making it the second biggest customer for northern Australia's live cattle trade.

According to Hindle, Vietnam benefited from Indonesia's introduction of a 350kg weight restriction for imported cattle. "The weight restriction meant exporters with animals below 350kg needed to find new markets and Vietnam became a lifeline," he explained. "If you look at a new market like Vietnam, they're taking slightly different cattle, because their first port of call is not to feed, but to slaughter, so they're more cattle traders. A slaughter animal is more the target for Vietnam."

Hindle believes the Northern Territory government played a crucial role in establishing Vietnam as a significant trading partner. "They've been in Vietnam for (slightly) over two years with specialists providing technical advice to supply chains," he said. "The local government here played an integral part in framing the supply chains and making sure the advice was sound and the supply chains were ready to go for ESCAS approval."