Record Australian beef exports in 2008

by Editor
Monday, January 12, 2009

A record volume of Australian beef and veal was exported during 2008, despite a slow start to the year and the high Australian Dollar ($A) during the first six months.

Japan maintained its place as biggest Australian beef export market. Exports for the past calendar year reached 957,479 tonnes swt – up 2% from 2007. This beats the previous record high of 953,932 tonnes in 2006.

The jump in shipments started in April, with increased supplies (after a low March quarter) and a surge in demand from Russia.

The 30–40% decline in the $A over the second half of the 2008 year proved to be a mixed blessing.

It reduced the relative prices of Australian beef to key export markets.

But exports still faced the full blast of the global financial crisis and deteriorating economic conditions, and disrupted trade.

Japan easily maintained its place as Australia’s largest beef export market in 2008, with exports falling 4% year-on-year, to 364,302 tonnes swt.

Although exports for 2008 remained 10% below the record volume of 405,794 tonnes in 2006, it was still a very strong result given the low grainfed beef supply, higher $A during the first half of the year and increased competition from the U.S. later in the year.

Given the significant decline in the number of cattle on feed in Australia during 2008, grainfed shipments to Japan for 2008 declined 13% year-on-year, to 149,183 tonnes, making up 41% of total shipments – the lowest grainfed percentage since 2003.

Exports to the U.S. for 2008 totalled 234,779 tonnes, down 23% year-on-year and the lowest level since 1997.

Exports to the U.S. were very sluggish for the first nine-months of the year, falling 34% year-on-year, influenced by a stronger $A at the start of the year and increased exports to Russia.

However, the final three months of the year saw a sharp turnaround in exports to the U.S., as the fall in the $A assisted a 23% jump in exports.

Increased competition from U.S. beef in Korea during the second half of 2008 contributed to a 15% decline in Australian exports for the calendar year, to 127,207 tonnes.

Australian beef and veal exports to Taiwan also declined 7% year-on-year, to 27,098 tonnes.

2008 saw Russia emerge as Australia’s fourth largest beef market, with the Commonwealth of Independent States (CIS – almost all to Russia), taking a record 72,035 tonnes.

This was despite shipments almost ceasing over the final few months of 2008, due to payment and credit issues stemming from the global financial crisis.

A sharp fall in competition from Brazil was largely behind the surge in demand from Russia, South East Asia and the European Union in 2008.