Monday, March 04, 2013

Increases in Aussie Beef to China

While the export of live cattle to indonesia and even elsewhere is slowing [ and it is the wet season too], there are some very significant increases occurring in sales of Australian beef to China.

Probably more importantly, it is in less expensive cuts, and not necessarily in the highest priced cuts eg scotch fillet or rump steak which often dominate boxed beef often sold to Asian markets.

It augurs well for potential sales from new abbattoirs in north Australia, especially the one near Darwin, which will hope to process some animals that may have gone to Indonesia.

China is showing an appetite for Australian beef that is rivaling its desire for our mineral resources.
A surge in exports to the Asian giant in the first two months of 2013 on the back of spectacular growth last year is causing Meat and Livestock Australia to step up promotion of our red meat products, mainly through the food service and restaurant trade,  and beyond Beijing and Shanghai to other lesser know cities here in Australia such as Tianjin, Hangzou and Shenzen.  MLA marketing manager Micheael Edmonds said China's beef buying patterns were beginning to show real promise for Australian exporters, who are still struggling to lift volumes in the sluggish Japanese and Korean markets.   "There's been a lot of talk about the opportunities in Asia but now we're really starting to see significant growth and some runs being put on the board," Mr Edmonds said.  "We saw it over 2011 and 2012 where China was without a doubt the shining light in the Asian region. "And there are opportunities at both ends of the market for both grass-fed and grain-fed product, with manufacturing beef and shin-shank filling the bulk commodity cuts and significant movements of brisket, once traditionally bound for Japan, now heading to China where they are fetching better prices."
Data released by MLA last Friday shows China flexing its buying muscle in February, with beef exports estimated to go close to exceeding the 10,000 tonne shipped weight mark by the end of this past week.

The MLA forecast for 2013 was 35,000 tonnes, but this could easily be exceeded based on current sales.   MLA chief economist Tim McRae said the growth was even more extraordinary given that prior to last year, which saw 32,900 tonnes exported, the largest calendar year total to China was only 7200 tonnes.

AAco had been making noises about a surge in sales to China, prior to the finalisation of the plans for the local processing facilities, and they may well be correct.

BUT....... could we also see the fickle nature of big sales to China, similar to mineral sales.  Or will they produce enough red meat, both beef and lamb, from land purchased in Australia by sovereign companies, bypassing any Australian profit, in a type of vertical integration system??

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