November 5, 2009

 

Australia beef exports down 15 percent in October

 

 

Australian beef and veal exports during October declined 15 percent year-on-year, as weak export demand and prices to the US and Japan were compounded by the stronger Australian dollar.

 

Processors continued with scaled back operations as the supply of suitable cattle remained tight. Exports for the month totalled 79,521 tonnes swt, with lower shipments to the US, South Korea and Russia, while a record volume of beef was shipped to Indonesia.

 

While Australian beef shipments to Japan in October reached 31,097 tonnes swt, up two percent year-on-year, they were seven-percent below the five-year average for October.

 

Sluggish consumer demand in Japan, combined with the higher Australian dollar, has resulted in prices for Australian beef being well below the corresponding period last year, squeezing exporter margins.

 

For October, indicative chilled grassfed fullest prices in Australian dollar terms averaged 19-percent lower year-on-year, while shortfed fullest prices were down 23 percent.

 

For January to October, Australian beef and veal exports to Japan dropped two percent on-year to just above 300,000 tonnes swt.

 

Exports to the US in October dropped 42 percent on-year to 16,187 tonnes swt. The combination of reduced demand and prices, with the higher Australian dollar, had exporters looking towards other markets, with Australian 90CL manufacturing beef prices averaging 30-percent lower year-on-year, during October.

 

While exports to South Korea for October were down 19 percent on-year, it was the fifth consecutive month shipments had surpassed 10,000 tonnes swt. Exports to South Korea for the first 10 months of 2009 were at 92,819 tonne swt, down 11 percent below the corresponding period last year.

 

Australia exported 6,095 tonnes of beef to Indonesia during October, breaking the previous monthly record set in July. Indonesian demand for Australian manufacturing beef has been strong in recent months, helping exports to exceed 40,000 tonnes swt for the first 10 months in 2009, surpassing the 33,019 tonnes swt shipped in the previous year.

 

The Philippines imported 2,626 tonnes swt of Australian beef during October, the highest monthly total in 12 years.

 

Exports to China and Hong Kong were also well above the same period last year, with the two markets already having taken 9,900 tonnes swt of Australian beef in 2009, up 154 percent on last year.

 

Australia's beef production in September fell 6.4 percent on-month to 176,862 tonnes, but was slightly higher on a year-on-year basis, according to the Bureau of Statistics on Wednesday (Nov 4).

 

The total number of cattle slaughtered in September, excluding calves, declined 7.5 percent on-month and dropped 0.8 percent on-year to 657,034 head.