Beefing up the Cats

Friday night's game notwithstanding, according to a report in the Weekly Times it is official - red meat (and lots of it) is the food of Australia's champion AFL team.

The paper says that the private chef to the Geelong Football Club, Adrian Millman, has revealed the secret to success for the top-of-the-table club is a protein-based diet high in beef.

Millman says the club has done away with fancy nutrition plans and reverted to "simple food" and that the players eat a lot of protein, especially during recovery and after training.

Typically, fillet and porterhouse steaks of 250-300 grams are served at lunch and dinner and Millman sources all his produce fresh and makes his own mince, soups and casseroles to minimise waste as he prepared three meals a day, six days a week for the players and officials.

Indonesia deals a heavy blow

Problems with Australia's biggest live export market for cattle could change the supply dynamics of slaughter beef in the north - and put some pressure on southern markets according to the Weekly Times.

Indonesia, which accounted for a massive 81 pc of all the live cattle sold out of Australia in the past 12 months, or more than 700,000 head, is now enforcing a weight limit of 350 kilograms liveweight on all its shipments.

It has made headline new in Queensland and the NT as tyhe weight regulation - which has previously existed buty not been policed by Indonesian authorities - has stopped the flow of cows and other heavier slaughter animals being absorbed by Indonesia at healthy money.

To highlight the impact of the crackdown, Consolidated Pastoral Company, which runs 300,000 head in northern Australia, says that it will now have to find new markets for as much as 40 oc of its herd.

Heifers hit a high note

Prices for heifers at the Ballarat saleyards - both grown and weaners - last week hit a new high for the year despite another large yarding according to a report in the Weekly Times.

The paper says despite 3309 head being yarded, DJ and AL Briody's 10 Angus heifers, aged 20 months and weighing 441 kilograms, topped the heifer market at $745, or 182 cents, doing to a SA backgrounder.

While restockers looking for breeding replacements were prepared to pay between 190 cents and 200 cents a kilogram for suitable heifers, buyers planning to finish them on either grain or grass would only go to 180-190 cents.

Younger spring drop steers were very affordable, even though prices are still five cents up on last month's Ballarat sale, but competition was fierce for grown steers - particuarly those weighing more than 400 kilograms - and they sold to a top of $1000.

Tropicals crank up production

In its earliest days, tropical pasture proved a risky business as its fluffy seeds did not flow through the seeders easily, leading to patchy germination according to a report in The Land.

However, the paper says that the creation of the "seed pellett" has changed all of this, with tropical pastures now doubling, and in some cases trebling, its dry matter production potential.

Heritage Seeds state manager Adrian Driden says the uptake of tropical pastures has increased dramatically during the past few years when only 10 years ago people who were dabbling in them were "considered eccentric".

However, since the development of a lime coating, which also contains nutrients, fungicides, and insecticides, forming the "seed pellet" their success through conventional sewing equipment has given them a new lease of life.

Dollar makes trading a little easier

An improvement in the supply of cattle and the lower Australian dollar have certainly made trading a little easier for lotfeeders in the first three months of this year according to a report in The Land.

While the Australian Lot Feeders Association (ALFA) figures for the number of cattle on feed for the second quarter are still a few weeks away, there are indications there were more feedlot-suitable cattle being offered at saleyards and direct from the paddocks.

But, surprisingly, the paper says that has not led to cheaper prices for cattle entering feedlots and while there have been a few peaks and troughs, the general trend since January has been steadily dearer

The price did dip towards the end of the autumn, as there were bigger supplies of unfinished stock entering the market as the weather cooled off, and some areas of the State became more desperate for rain, but by early June the prices were climbing again.

Slow demand

A national Rural Press report says that demand from Japan for Australian beef was slow last week as the market enters the rainy season according to Meat and Livestock Australia.

Overall meat consumption tends to ease during the period, before picking up again with the arrivals of the Japanese summer holiday season - which runs from mid July to the end of August.

MLA reported that export prices to Japan last week varied as well, but says that the appreciation of the Australian dollar actually reduced overall returns to Australian beef exporters.

Australian chilled grassfed prices were soft across the board in the Japanese wholesale market last week, particularly striploin, which was down eight pc but US beef prices were mostly firm, although demand was sluggish.

Yard fees soar at Warrnambool

Warrnambool saleyard fees will soar almost 50 pc to help pay for its upgrades after the city council's 2010-2011 budget was approved last week according to a report in the Stock and Land.

 The cattle yard dues change from September 1 and will include a four pc consumer price index increase over the previous financial year's costs - plus an extra $3 a head on prime, store and dairy cattle, raising their fees to $11.30, $10.10 and $12.45 a head respectively

The agents have not escaped the 48 pc increase either according to the paper - their fees will jump $4500 for each of the five agents using the Caramut Road saleyards - raising a total of $22,500.

Warrnambool stock agents failed in an attempt to negotiate a more moderate increase closer to the CPI, despite suggesting necessary upgrades could be limited to $505,000 over the next two years and that the money needed to be borrowed to fund the capital works.

Rangers Valley feedlot moves to EU accreditation

Within the space of a month, Rangers Valley feedlot, at Glen Innes, hopes to have completed its value-adding European Union (EU) accreditation process according to a report in the Stock and Land.

The paper says that this will see the feedlot begin acquiring EU-accredited cattle to go into its 300-day grain feeding regime, specifically aimed at being onsold as part of the Australian and American 20,000 tonnes EU beef quota.

Rangers Valley sales and marketing manager Leith Tilley says because of the operation's feeding process, it is important that they get their cattle in as soon as they can.

Initial estimates from the feedlot suggested that cattle purchased specifically for the EU quota will total between five and 10 pc of monthly buying - or about 250 head - to make the program worthwhile.

Strong BeefEx support

A report in Stock and Land says the positive signs of rebuilding feedlot numbers have lifted expectations of a strong attendance at the grainfed beef industry's biennial BeefEx conference, which will be staged in October.

Registrations opened strongly a few weeks ago and the Australian Lot Feeders Association events committee says that its expects conference spaces to fill rapidly, despite the event still being some months away.

All 300 rooms at the five-star Royal Pines resort on the Gold Coast have been reserved but industry stakeholders planning to attend are still being advised to book early to avoid the inconvenience of being shuttled from outside accommodation venues should the "no vacancy" signs go up.

ALFA's BeefEx events committee chair Gina Lincoln told the paper that her team has aimed to develop a program to reach a broad range of stakeholders, ensuring content is relevant and appropriate irrespective of the size and scale of the feedlot or supporting industry members attending the event.

2020 vision for feedlot industry

A previous Meat Research Corporation (MRC) project - M.544 input requirements for the cattle feedlot industry - has highlighted the managerial and economic benefits of stratification and differentiation of livestock production activities says Stock and Land.

Since that time the paper says that a number of Australian beef industry operators have adopted and benefited from this strategy, turning cattle off breeding areas at an earlier age and transferring them into the feedlot production system. 

The feedlot sector believes that if the industry-wide benefits of these strategies could be demonstrated and quantified, the pace of beef industry structural change would be accelerated, accruing benefits to all sectors of the industry.

Project B.FLT.0132 - A 2020 vision for the Australian feedlot industry - was designed to evaluate and demonstrate the economic, environmental and social benefits of these feedlot industry development strategies going forward to the year 2020.

Avoid liver fluke with early action

Producers thinking about delaying the treatment of their herds for liver fluke following the relatively mild autumn should seriously be rethinking their strategies according to a report in the Stock and Land.

The paper says that beef cattle infected with the liver fluke show lower growth rates and lower feed conversion rates while it causes infected dairy cattle to produce less milk - and milk of a lower quality.

The young flukes penetrate the liver capsule and migrate through the liver tissue for up to six or seven weeks before entering the bile ducts to become adult flukes and resulting damage can cause anaemia, lowered appetite, in some cases bottle jaw and at worst, death.

Animals suffering from acute liver fluke disease may not show any obvious symptoms, making it even more important to treat the most susceptible stock and NSW DPI vet/state worm controller Stephen Love says if your farm is in a fluke-prone area such as eastern NSW and Victoria, chances of infection are high.

Sassafras to Surry Hills

Sassafras, Tasmania, beef farmer Kel Sharman was astonished to learn that meat from a beast he sold for $5 a kilogram was now on sale at a butcher shop in inner Sydney for $69 a kilogram says a report in Stock and Land.

Responding to contact from Sydney Morning Herald journalists tracing the origins of a basket of food products sold in Sydney, Sharman said: "You are joking. I'm in the wrong line of business."

Every piece of meat sold in Australian can, theoretically, be identified and traced back to its source paddock, with the barcode on its packaging linked to the NLIS ear tag fitted when each calf is born.

But in practice tracing meat to its source can be difficult says the paper because of the complex and often disjointed relationship from the retail shelves to the farm, via the abattoir, transport, storage and distribution companies - but in the case of Mr Sharman it showed how effective it can be.

Agents given 'killer' insight

A report in the Stock and Land says that 45 independent stock agents, drawn from four states, took part in an educational paddock-to-plate workshop at the MC Herd abattoir in Geelong last week.

Hailing predominantly from the livestock-rich Green Triangle area of western Victoria and southeast South Australia, the group was schooled on a range of issues including the importance of networking, committing to an agent code of practice and forming strong alliances with processors.

Organised by Rural markets Agents (RMA), a network of independents, the two-day event got participants out of their comfort zones of live animal assessments in saleyards and on-farm and looking at carcases much in the way processors do.

The paper says the MC Herd livestock manager Nigel Vince told the gathering of mostly young agents that equipment, machinery and the ethics of the company's Bacchus Marsh Rd workforce had come a long way in the 28 years he had been with the company.

Egypt shipment eases trade deadlock

A large shipment of heavy feeder cattle, which has sailed from Townsville for Egypt, is providing a crucial pressure valve for northern Australia's live export industry says Queensland Country Life following recent bans enforced by Indonesia on cattle above 320 kilogram.

The paper reports that the Wellard-owned vessel Ocean Shearer set sail after loading 17,300 bos Indicus-derived cattle, mostly steers and most significantly with an average liveweight that was above 400 kilograms.

The Townsville consignment is only the second to leave Australia for Egypt following a three-year market exclusion due to animal welfare concerns and one of the key attractions of the reviving Egyptian trade is that market will take steers up to 450 kilograms.

Even though Egypt is less receptive to females, at least half of the current shipment was made up of cattle which had been defaulted out of an earlier Indonesian order due to the ongoing import permit access issues.

Community rallies for local selling centre

Producers, livestock agents and community members from across the South Burnett have staged a supporters' rally tom highlight the central role of the Coolabunia saleyards in the South Burnett economy says a report in Queensland Country Life.

The paper says that the South Burnett Regional Council is reviewing the facility amid concerns for the workplace health and safety standards - as well as the associated costs required to upgrade the facility.

An independent feasibility study of the saleyards has been commissioned by the council, and it is expected this will be handed down following the release of the council's June budget.

Supporters of the saleyards says they fear that high maintenance costs could result in the closure of the facility, which they also say would impact on the district's business community and place added transport costs on small producers forced to sell cattle at yards further afield.

NQ market update

Meat and Livestock Australia (MLA) reports an exceptional 2009-10 wet season is providing the northern half of Queensland with some of the best seasonal conditions in decades heading into winter, with reports of ample feed and water supplies across a vast expanse says Queensland Country Life.

Recent weeks have seen some strong yardings at Longreach, with good prices reflecting the overall high quality of stock presented. Year-to-date yardings are also up on the same period last year with producers hitting a lot of the desired sale weights.

The paper says they were particularly able to do this in the autumn, when the bulk of northern numbers are turned off, and while numbers were 39 pc up on the same period last year they are still a third below where they were during 2008.

The largest yarding in Longreach so far in 2010 was the second week of April, with more than 3300 head penned. More interestingly, about 40 pc fewer cattle were yarded in the second half of 2009 due to lower stocking numbers.

MLA UPDATE

Cattle market wrap

25 June 2010

Over the hooks rates ease

The recent rise in the A$ resulted in a couple of processors in Queensland and one in NSW lowering direct to works rates 5¢ to 10¢/kg cwt this week. This continued the cheaper trend registered the last three weeks.

When the A$ fell to the low US80¢ range at the end of May, processors had an improved outlook, resulting in a slight lift in prices due to increased enquiry from overseas. In the last week of May, Japan ox in the south of Queensland averaged 317¢, 306¢ in the north and 316¢/kg cwt in NSW. In the same week, cows weighing 240-280kg cwt averaged 268¢ in southern Queensland and 265¢/kg cwt in NSW. Since then, the A$ has risen gradually and been subjected to daily fluctuations.

The increased value is creating a tough trading environment, with downward pressure on prices from overseas buyers and sluggish demand. This, coupled with good supply in Queensland, wintery conditions, a lack of rainfall over the past month and the end of the financial year encouraged producers to offload. A number of processors are reporting good supplies of cattle booked in advance, with supply also expected to be boosted by cattle over 350kg lwt that are unsuitable for live export to Indonesia.

These factors have caused over the hooks rates to fall in Queensland over the past month. Japan ox are currently averaging 306¢ in the south of the state and 291¢/kg in the north. Cows weighing 240-280kg cwt are averaging 258¢ in the south and 248¢/kg in the north.

Over the same period, NSW prices have not experienced the same decline. Processors are faced with tighter supplies of quality cattle and have had to raise rates in a bid to attract better quality consignments. This week, direct to works rates were mostly cheaper on last week, averaging 316¢ for Japan ox, while cows 240-280kg averaged 268¢/kg cwt.

Supply grows

With all Monday markets held this week, numbers returned to similar levels to a fortnight ago at MLA's NLRS reported physical sales. Supply, however, was only 16% higher compared with the shortened week last week.

Yardings in most states increased, except in Queensland, where they were down due to significant falls at both Roma sales and Longreach. The other states all had increases, although there were a few less offered at certain markets.

The increase in yardings had mixed impacts on indicator grades this week, with quality once again being a factor. The Eastern Young Cattle Indicator (EYCI) fluctuated throughout the week to finish firm on last Thursday at 350.75¢/kg cwt. The trade steer indicator increased 1¢, to 191¢ and feeder steers increased 4¢, to 187¢/kg lwt.

After a rise in the A$, Japan ox slipped 6¢ to 176¢, and US cows settled 1¢ lower at 136¢/kg lwt.

A mostly dry week

25 June 2010

The week gone by was another dry one for most of rural Australia, with significant rainfall limited to isolated coastal regions. The south-east of Australia saw the most widespread rain, with the Victorian high country and western Tasmania getting some good falls. A number of weather fronts are expected to move through over the weekend, with at least one bringing strong wind and rain to the south-east, as well as snow above 1,600m.

Roma saleyard comment

25 June 2010

Seasonal conditions have been favourable during June, and although the grass has hayed off, light showers have helped to retain soil moisture. Most oat crops are looking good, particularly to the north of Roma and around Injune.

Cattle condition has benefited from the good summer and most are in very good condition. Only recently have there been plainer lines from central and north western areas.

Numbers have begun to slow at both the Roma Prime and Store sales, with fewer cattle from the south east. Prices have remained firm, and are likely to become dictated more by quality as winter progresses. Competition has been steady, with more NSW buyers present to underpin demand.

Japanese demand watered down

25 June 2010

The trade in Japan reported sluggish demand for all meats this week, largely due to the rainy season, as well as subdued spending by consumers. Japan's Cabinet Office increased their GDP forecast for this Japanese fiscal year to 2.6% (from the earlier estimate of 1.4%), however, consumers are remaining conservative and tight-budgeted for now.

Beef export trading from Australia was also slow, with limited interest from both Japan and the US easing export trimming prices this week.

The Agricultural Ministry of Japan listed the 291st case of foot-and-mouth disease (FMD) in the Miyazaki prefecture on 18 June - there has been no new case confirmed this week. Chikusan Nippo reported an increase in calf prices in the Japanese livestock market recently, probably due to the temporary closure of cattle saleyards in Kyushu and Okinawa regions due to FMD.

US market moves lower

25 June 2010

The imported 90CL manufacturing beef market in the US continued to come under pressure this week, as the price outlook for August and September points to a bearish market.

Prices for imported 90CL manufacturing beef shed 3¢ on last week, to 151.5US¢/lb CIF. Since mid-April, the imported 90CL indicator has been declining each week. Between March and May, imported prices remained at a premium to US domestic fresh 90CL trim indicators. However, historically, imported prices are usually at a discount to domestic prices at this time of year.

The imported 90CL manufacturing beef indicator this week moved to an 11¢ discount to US domestic 90CL fresh trim product.

Solid exports ahead of Korean Chuseok demand

25 June 2010

Australian beef exporters reported that both Korean beef demand and prices were solid this week. From 1 - 22 June this year, beef exports from Australia to Korea totalled 8,336 tonnes swt, with chilled beef accounting for 25% of the total.

While beef consumption is usually subdued during summer months (compared with the rest of the year), some Korean beef importers have started to boost their stocks in preparation for Korea's Chuseok (Harvest Festival) celebrations on 22 September.

According to market sources, numerous retail chains are currently promoting chicken due to seasonal demand, and the current FIFA World Cup held in South Africa. The Joong Ang Daily has also reported that large discount stores, including E-mart, Homeplus and Lotte Mart are stocking fried chicken, as demand has soared on days that World Cup matches are held.

Brazilian exports to rise in 2010

24 June 2010

Brazilian beef exports are forecast to increase 6% to 1.7 million tonnes cwt in the 2010 calendar year, according to local consultant AgraFNP's annual publication Anualpec 2010.

The rise in exports will be backed by a 2% rise in total beef production to 7.778 million tonnes cwt and a lower 1% rise in domestic beef consumption to 6.104 million tonnes cwt.

The herd is expected to continue to recover since 2007's low, and increase 2% in 2010 to 176.6 million head.

US cattle placed into feedlots surge

24 June 2010

Cattle placed into US feedlots rose for the third consecutive month, up 23%, to 2.022 million head during May (United States Department of Agriculture). The extent of the increase is in line with US analysts' expectations, with a number of factors supporting the surge in placements.

Improved pasture conditions earlier in the year meant US producers kept feeder cattle on grass for longer, feedlots have been anxious to start rebuilding feedlot inventories following lower placements earlier in the year and currently lower feed costs.

Larger placements over the past three months have not impacted US fed cattle prices, with the Choice beef cutout indicator currently 9% above year ago values. While Steiner Consulting Group is forecasting the Choice beef cutout indicator to ease from current levels heading into August (given the higher placements), the average forecast for August of 151US¢/lb is still 6% above year ago values and 4% above the five-year average.

US analysts are expecting placements to slow over coming months due to US summer grazing cattle not likely to be available till the US autumn months.

Japan foodservice valued at A$400 billion

24 June 2010

In 2009, the estimated value of the Japanese foodservice sector declined 1.8% year-on-year to 29.5 trillion yen (A$400.4 billion), according to data released by Foodservice Industry Research Institute of Japan.

Industry sales peaked in 1998 at 32.9 trillion yen (A$399.8 billion), but have trended down since, due to a fall in private and business expenditure for dining out. In 2009, sales values of most foodservice categories declined year-on-year, with the exception of fast food, school meals, hospitals, and take away food.

The Japan Foodservice Association forecasts continuing demand in take away/cooked meal services, on the back of an increase in smaller households and an aging population. It also anticipates consumers' ongoing interest in healthy food and a balanced diet.

Brazil targets Middle East

24 June 2010

Brazilian beef exports during the fiscal year to May remained stable, decreasing only 0.5% year-on-year to 861,631 tonnes swt, mainly supported by increased demand from the Middle East and Northern African region. Brazilian exports to this region increased 14% to 350,578 tonnes swt over the period. In contrast, exports to the CIS fell 13% to 285,521 tonnes swt year-on-year.

The increased trade with the Middle East and Northern Africa has been driven by booming exports to Iran, with a record 18,094 tonnes swt in May (Brazilian frozen stewing cuts have a strong retail presence in this market), in addition to increased volumes to Egypt, Lebanon, Saudi Arabia, and Algeria among others.

Brazilian beef presence in the region has increased in recent years mainly as a result of rising demand, the suitability of Brazilian product for the Middle Eastern and North African consumer, government lobbying, in addition to the strong brand positioning of Brazilian chicken in these countries (during the fiscal year to May, Brazilian chicken exports to this region grew 17% year-on-year to 1.3 million tonnes and accounted for 43% of total Brazilian chicken exports).

Australian consumer confidence gains

24 June 2010

Australian consumer confidence increased 6 points in a week to 123.6 points on the weekend 20 June 2010 - days before Prime Minister Kevin Rudd was replaced by Deputy Prime Minister Julia Gillard. The weekly consumer confidence index was also 9.7 points higher than the same time last year, according to Roy Morgan.

Contributing to the increase in consumer sentiment was a four percentage point rise in the proportion of Australians (to 30%) stating that their family is 'better off financially' compared with a year ago, and 41% (up four percentage points) saying they expect their family to be 'better off financially' in a year's time.

There also was a strong rise in buying sentiment, with 58% (up 2 percentage points) of Australians saying now is a 'good time to buy' major household items - the highest since mid January.

NZ beef exports on the rise

24 June 2010

New Zealand beef and veal exports totalled 47,125 tonnes swt in May 2010, 6% higher than a year earlier, with exports increasing to most Asian markets. Similar to Australia, the value of the NZ$ fluctuated significantly during the past month, leaving many importers very cautious, with the NZ$ trading in a band between US66-74¢. (Reserve Bank of New Zealand).

Beef and veal exports for the period January through May were up 3% on the same period last year, at 194,420 tonnes swt. Shipments to the US - which typically account for close to half of all NZ beef and veal exports - have been fairly constant on 2009 levels, totalling 92,874 tonnes swt.

Shipments fluctuated to other markets, with a large drop in volumes to Canada (back 37% to 11,856 tonnes swt) largely offset by a 16% rise to Japan (15,714 tonnes swt), a 23% lift to Korea (17,733 tonnes swt) and a 45% increase to South East Asia (25,997 tonnes swt) (NZ Meat Board).

NZ adult cattle slaughter for the first four months of 2010 was running at 3% higher than a year earlier, at 1.05 million head, with 3% less cows, but 13% more steers and 3% more bulls coming forward. This change in composition along with the better season has helped increase average carcass weights, with production up 7% to 272,224 tonnes cwt for the same period (Statistics NZ).

Surge in Argentinean beef to the EU

24 June 2010

Argentinean beef exports during May were up 27% on April, to 8,704 tonnes swt. However, the surge for the month comes mainly as a result of the 133% increase in "Hilton" High Quality Beef (HQB) exports to the EU, to 3,399 tonnes swt.

Argentinean exporters have rushed to try and complete their respective shares of the 2009-10 quota - with a rising number of shipments being air freighted in June. In contrast, total beef exports remain 64% lower year-on-year.

The urgency comes as a result of the delay in the distribution of the HQB quota among local exporters by the Argentinean government (which allowed HQB shipments of the 2009-10 period to start only in November), in addition to the tightening of export restrictions, given the fall in local Argentinean supplies.

The local industry estimates that only 18,000 tonnes will be shipped out of the total 28,000 tonne HQB quota for the 2009-10 fiscal year.

In addition to the reduced supplies for the EU, European importers have advised Argentinean suppliers they will be applying discounted quotes for their products. As well, a number of major EU importers are evaluating with EU authorities over taking the responsibility of distributing Argentina's quota among exporters (instead of the Argentinean government) to secure a more reliable distribution and supplies (Infocampo)

Bargain period ends in Brazil

24 June 2010

Brazilian steer prices are expected to recover and increase over the medium term, similar to those rises experienced between 2006 and mid 2008, when prices surged as a result of higher demand and tighter steer supplies (Scot Consultoria).

Brazilian live steer prices have been suppressed in recent months, due to a number of factors, including very competitive chicken prices and a reluctance from meatpackers (affected by the rapid appreciation of the real since the global financial crisis) to pass higher prices back to producers.

The positive price outlook for grown cattle in Brazil comes as a result of the current imbalance between restocker and grown cattle prices. Prices for young cattle categories have largely surpassed the average grown steer price premium since early 2008.

The disparity in prices is largely due to a lack of cattle, the result of the 2005-2007 liquidation when a high percentage of female cattle were sent to slaughter, at the same time exports boomed and steer supplies tightened.

The recovery in beef exports since October 2009, assisted by the opening of new markets for Brazilian beef, combined with rapid growth in the local consumers' purchasing power is expected to result in a strong pull through for cattle prices from the demand side.

Beef exports to South Asia improve

24 June 2010

Australian beef exports to South East Asia and Greater China during May increased 13% from April to 10,172 tonnes swt. May shipments remained 2% lower compared with May 2009, affected by falls in exports to Indonesia, China, Hong Kong, Singapore and Thailand. Meanwhile, trade to Taiwan, Philippines and Malaysia continued an upward trend.

Over the calendar year to May, beef exports to South East Asia and Greater China decreased 3% on a year ago, to 44,954 tonnes swt, after being affected by tight supplies earlier this year. Manufacturing beef remained the most popular cut exported to the region during the period, with total shipments staying at 15,325 tonnes swt.

Shin shank, the second most popular cut to South East Asia and Greater China increased 6% year-on-year during January to May, to 8,218 tonnes swt, due entirely to strong enquiries from Taiwan and mainland China.

Beef blade shipments fell 18% on last year to 3,440 tonnes swt, although remained the third popular cut shipped to the region - competition from South Korea for blade/clod affected consignments to Indonesia, Malaysia and Singapore.

Looking ahead, beef exports to South East Asia and Greater China is expected to continue to face competition from other Australian markets, including Russia, although improved supply and the stabilised A$ may facilitate trade to the region.

Brazilian beef exports to South Asia retreat

24 June 2010

Brazilian beef exports to South East Asia and Greater China during January to May fell 15% compared with the same period in 2009, to 47,479 tonnes swt, as beef supplies remained tight in Brazil. Shipments of Brazilian beef to all markets in the region dropped during the first five months of 2009, with the exception of the Philippines, where better economic conditions boosted demand for beef.

Meanwhile, New Zealand beef exports to South East Asia and Greater China during January to May continued at record levels, up 21% year-on-year, to 40,343 tonnes swt - largely due to an increase in trade to Indonesia and Philippines.

US beef shipments to the region also jumped 34% during the five months to May, to 42,953 tonnes cwt, with the rise largely reflecting stronger demand and the lower value of the US dollar.

Australian beef exports to South East Asia and Greater China for the same five month period declined 3% on the previous year, to 44,954 tonnes swt, with subdued supplies early in the year impacting shipments.

Stock condition ‘key standards'

Farmers who present stock in poor condition may be prevented from loading them by transporters under new national animal welfare livestock standards and guidelines being developed, says Stock Journal.

The paper says that this was one of the key issues raised at last week's Livestock Transporters Association of SA conference in Adelaide, which attracted more than 100 industry leaders.

The guidelines are expected to be finalised and enforceable by the end of next year and from then on if transporters are not satisfied with the condition of animals they could be legally required to refuse loading.

Department of Environment and Heritage's Deb Kelly and PIRSA's Mark Peters outlined the development of the new national Animal Welfare Standards and Guidelines at the conference.

Microbial profiling takes huge step forward

Stock Journal reports a SARDI project has successfully developed a range of microbial profiling techniques to investigate gut bacteria, archaea (methanogens), fungi and protozoa in ruminants.

Researcher Dr Valerie Torok says these interim successes have produced tools which are now being used in collaborative projects which will investigate the influence of feed and genetics on methane production.

The project started in April last year and is due to report in December next year and is targeting DNA-based microbial profiling to assist the research team to rapidly evaluate feeding, breeding and management strategies in an effort to reduce methane production in ruminant systems.

Dr Torok says that the next step in the project will be to compare differences in microbial populations between animals shown to produce high and low levels of methane gases. Details at http://www.sardi.sa.gov.au/.

Beef heats up

Trade cattle prices could be in for a rough ride in the next few months according to a report in The Land, amid speculation the Eastern Young Cattle Indicator (EYCI) could be headed for a new record peak this winter.

The paper says that trade steers remained in limited supply during the past week, with the traditional winter shortage only putting further pressure on prices, forcing young cattle up another 0.75 cents a kilogram (carcase weight) to 350 cents.

Current prices are about 18 cents a kilogram higher than they were at the same time last year, leading some industry analysts to speculate the EYCI could reach a new winter high.

Meat and Livestock Australia's chief market analyst Tim McCrae says average monthly prices for the past eight years increased by nine to 11 pc between May and August and with the possibility of a lower Australian dollar and rising export demand prices may even outstrip the normal increase.

Ripe sale for Braidwood

Southern Tablelands beef cattle producer Ray Hall thinks the young cattle market's "mini boom" could stick around - for a while at least according to a report in the Weekly Times.

Hall has told the paper that he has been scaling back breeder numbers at his Braidwood Cattle Company property by about 40 pc to about 1200 head and ramped up trading of mixed breed steers.

While he isn't ruling out rebuilding breeder numbers if the season allows, in the current climate he is more than happy to reap the benefits from selling young steers direct into the feedlots.

He says they were "ripe" for offloading at 400 to 500 kilograms, and has about 400 young steers almost ready to go and "relative to the prime cattle market trade steers are going well and I am impressed with the prices".

Foreign buyers set to swoop

A rush of foreign investment interest in Australian farmland is stirring new concerns about just how much overseas ownership of local agricultural resources is too much according to a report in The Land.

Unease about global food shortages in the next 20 years - and long-term agricultural market opportunities - has made Australia and areas of South America prized targets for foreign government-aided enterprises and private sector groups.

That paper says that Africa has also been the focus of a significant land grab, particularly by overseas government-owned investment corporations from China and the Middle East.

Last week the Foreign Investment Review Board told a Senate hearing it was possible for offshore owners to gradually buy whole districts without any government scrutiny. The FIRB will also only be notified of any agricultural land sales if their individual value exceeds $231 million.

Agri benchmark

Both beef producers and researchers have the chance to achieve an insight into how Australian beef production systems compare with global competitors at a special Industry and Investment NSW (I and I) forum this Friday (June 25) according to a report in The Land.

The agri benchmark forum, which the paper says will be held in Brisbane, will present a detailed account of how the Australian beef sector is coping after the global financial downturn, and how it fits into the worldwide market.

I and I beef expert Kirrily Pollock, Armidale, says producers, beef economists and advisers from 16 countries will be participating in the conference, which she says taking into account Australia's dependence on export markets is a bonus.

Pollock says that by coming together the wider industry is looking to unlock the drivers of beef competitiveness and profitability by comparing the performance of beef industries across the globe. Details from http://www.agribenchmark.org/.

Win a $12,000 study tour

Beef, sheep and dairy producers are being offered the chance to win a $12,000 overseas study tour as part of a new initiative to recognise and reward good animal health and livestock management practices says The Land.

Animal health product manufacturer Virbac Australia has last week launched its search to find three national winners from the beef, sheep and dairy industries for its inaugural Proud Achiever awards.

Entrants can nominate themselves, or candidates may be recommended by friends, neighbours, farm product suppliers or livestock sector professionals who consider them a good example of animal health and husbandry success.

The national winners will be able to choose their own overseas study agenda, which may include an agricultural tour, an international conference or visiting specific enterprises or research facilities. Details at http://www.proudachievers.com.au/.

Korean delegates' beefed-up tour

For the second time delegates from a major South Korean supermarket chain - GS Retail - saw Australian beef production up close and personal last week according to a report in The Land.

The return visit follows the inaugural tour jointly organised by GS Retail officials and Cargill Australia, and they have been designed to further promote business ventures between the two countries.

The paper says that the most recent trip enabled 12 GS Retail shop managers to see the entire process which goes into producing the meat that they are currently selling through their stores.

This included a visit to Cargill's Jindalee feedlot and an on-farm visit to a beef production and Border Leicester stud at Wagga Wagga. GS Retail has 158 stores in Korea - with plan to expand to 200 by the end of next year.

Grain claim grassed

That ongoing industry debate that grainfed beef does taste better than its grassfed counterpart have been slammed by a prominent Melbourne chef according to a report in the Weekly Times.

The paper says that a Texas, US, study (funded by the National Cattlemen's Beef Association) released last week claimed that meat from grainfed animals was "more healthful" than the beef produced by traditionally grassfed animals.

But chef Adrian Richardson, who runs the La Luna restaurant in Carlton North, and exclusively uses grassfed beef, as well as rare-breed pigs on his menu, says he does so "simply because it tastes so much better".

"Breeding animals is not like buying furniture at Ikea, it will not be the same every time. But the most import thing to me is the beef is grassfed - the texture and flavour are far, far superior". He dismissed the US research, saying if he was selling grainfed beef, like most of the product in the US, he would find a study to support that.

Prices to drop Senator warns

Brazilian controlled red meat processing giant Swift Australia should be forced to divest some of its market-dominating assets to reduce its market power according to a report in the Weekly Times.

That's the opinion of southern NSW beef farmer and maverick Liberal senator Bill Heffernan, who is warning the partnership between the Brazilian-owned Swift and a major retailer could lead to lower prices for farmers.

The Australian Competition and Consumer Commission (ACCC) is currently assessing whether or not Swift should be allowed to acquire feedlot processing facility Rockdale Beef at Yanco in southern NSW.

Swift currently controls 22 pc of the Australian processing sector, with the US-owned Cargill Australia the next biggest players with a 12 pc slice of the business. Swift has also recently entered the trucking business in southern Queensland.

More animals going to market

Restockers and lotfeeders absorbed increased numbers of cattle which flooded the market ahead of last week's Monday public holiday says Weekly Times, with vendors opting to make up for the rain-affected sales of the previous week.

The paper says that supply increased by 11 pc at saleyards monitored by the National Livestock Reporting Service (NLRS) and yet all categories of cattle in all states, except for trade steers in NSW, sold to firm rates.

This trend was further reflected in the Eastern Young Cattle Indicator (EYCI), which held steady last week to close at 349.25 cents a kilogram (carcase weight) with NLRS saying young cattle were mostly 2-score condition but well bred.

Stronger global manufacturing beef prices, particularly from the US, and anticipated lower supplies of cull cows in the months ahead should see cow prices maintain levels five pc up on this time last year.

Herd rebuilding comes at a cost

Beef cattle producers' farm cash incomes are expected to have fallen by almost 50 pc in southern Australia during the 2009-10 financial years according to a report in the Stock and Land.

The decline, due to herd rebuilding during the same period on the back of better seasons, will see income hit about $31,700 per farm in southern Australia says a report released last week by ABARE titled Australian Beef: financial performance of beef cattle producing farms 2007-08 to 2009-10.

This loss of cash income was far greater than that predicted for northern Australia, which ABARE says will experience an 18 pc reduction in farm cash income to around $66,000.

Dry conditions in southern Australia since the 2002-03 drought were the main cause for the big difference in predicted farm cash incomes between the northern and southern zones of the country.

MSA grading underpins branded meat success

Australia's largest red meat processor, JBS Swift Australia, attributes Meat Standards Australia grading system with underpinning the success of a proportion of its domestic beef brands says Stock and Land.

Three years ago when the Brazilian-owned company acquired Queensland-based Australian Meat Holdings it had no MSA brands, but now the business grades between 2000 and 3000 cattle a week.

Swift's Townsville plant was the first to become MSA-accredited - in May 2008 - and by the middle of this year Swift Australia domestic sales and marketing spokesperson Jamie Ferguson says all seven of the company's export beef plants will be capable of grading cattle for MSA.

Ferguson says Swift sees it as a way of value-adding its livestock, "as it should be for producers who can participate in supplying the better end of the market with tender, quality beef".

Mites eating hide prices

Cattle mites are now eating into both the quality of cattle hides and returns for producers, cutting into the overall value of the production chain according to a report in the Stock and Land.

Department of Primary Industries (DPI) beef industry development officer Maria Crawford says a wet and warm autumn has led to unusually high mite damage, which is costing the hides industry thousands of dollars weekly in lost hide value.

Crawford says that with hides the most valuable cattle carcase by-product this issue affects both beef cattle producers and the whole leather trade, with skins being downgraded from high grade to reject.

She told the paper that the cattle mite - demodex bovis - is the suspected source for this problem, living in cattle hair follicles and causing small nodules to develop in the skin, resulting in 15 pc of hides affected in the past two months.

MLA UPDATE

Consumption and won affects Korean beef demand

18 June 2010

Both Australian beef exporters and Korean traders reported that currency volatility and low beef consumption affected Korean beef demand this week.
Enthusiasm for Korea's participation in the FIFA World Cup in South Africa has triggered many consumers to eat outdoors. However, it was reported that most spectators are satisfying their appetite with snacks (e.g. fried chicken) instead of dining out (Joong Ang Daily).

Korean news sources have reported that chicken consumption has increased, as high temperatures have caused consumers to choose chicken over other meats. Along with fried chicken from franchise outlets, major retailer, E-Mart, indicated that chicken prices have increased due to stronger demand (Kukmin Ilbo).
Another factor slowing beef demand is the high volatility of the Korean won against the US$ - the won has been fluctuating on the euro's movements (Business Week).

However, major financial services company, Wells Fargo, reported that increasing Korean exports, manufacturing, investment and consumer spending should soon begin to pay dividends for the won (Business Week).

Overcast summer outlook in the US

18 June 2010

Despite the forthcoming Independence Day (4 July) holiday and summer grilling season in the US, the short term outlook for imported beef has been clouded by large and cheap chicken supplies, and a slowdown in foodservice activity.

The weaker buyer demand was reflected in a 1% fall in fresh 90CL domestic trimmings to 160US¢/lb, and a 1% fall in imported Australian 90CL cow meat to 154.5US¢/lb this week. Returns to exporters were further hampered by the rapid rise of the A$, which rose 3% on last week to 86US¢, pushing prices down 3% to 364.5A¢/kg FAS.

Given the current weaker demand signals (with little room for improvement in coming weeks), imports of Australian beef are expected to reach only 16,000 tonnes swt in June - 27% lower year-on-year and 39% lower than the five year average.

Japan enters damp season

18 June 2010

Demand for Australian beef from Japan was slow this week, as the market enters the rainy season. Overall, meat consumption tends to ease during the period, before picking up again with the arrival of summer holidays (mid July to the end of August).

Export prices to Japan varied this week, but the appreciation of the A$ from last week reduced the overall returns to Australian beef exporters.

In the Japanese wholesale market this week, Australian chilled grassfed prices were soft across the board, particularly striploin (down 8% from last week to 1,200 yen/kg). US beef prices were mostly firm, but demand was sluggish, according to the trade. Chilled US steak ready (striploin) Choice grade was traded at around 2,075 yen/kg this week (no change from last week), while Australian mid-fed striploin averaged 1,950 yen/kg (down 50 yen/kg from a week ago).

Lambs push records as cattle prices ease

18 June 2010

The short trading week across the eastern states put additional pressure on lamb prices this week, with records broken across many categories. In contrast, the cattle market eased, even with yardings tightening 19% on last week, with quality reportedly an issue across some regions.

While national average prices for the two lightest lamb categories eased this week, with restocker lambs falling almost 8%, the seemingly unrelenting march towards record heavy lambs prices continued. Trade and export lamb prices increased 4¢ and 7¢ on last week, to 538¢ and 528¢/kg cwt, respectively.

The coming weeks should be very interesting for the lamb market, with the record high prices undoubtedly placing significant pressure on processor margins. The key to how high this winter price peak will go probably lies with the numbers of old lambs to come through in July and the level of the A$.

A reported decline in the quality of cattle offered across many of MLA's reported saleyards this week largely offset the impact of lower numbers, with national averages falling across almost all categories. Trade steer prices averaged 5¢ lower, at 338¢, with Queensland prices slipping 8¢, to 330¢/kg cwt.

Friday daily livestock article

18 June 2010

Numbers dropped a little at Roma for a yarding dominated by cows. Heavyweight yearling steers averaged 173¢ while heifers slipped 8¢ to 154¢/kg. Heavy grown steers Improved 4¢ to average 167¢ and bullocks were firm topping at 170¢ to average 161¢/kg. Medium weight D4 cows were 5¢ dearer around 144¢ as heavyweights made 143¢/kg.

At Dubbo numbers were up but overall quality slipped. Vealer steers to restock averaged 186¢ while heifers to the trade were 4¢ to 13¢ dearer with medium weights mostly making 178¢/kg. Yearling steers to feed were 7¢ cheaper around 186¢/kg. Heavy grown steers made similar rates to last week around 180¢ and medium weight D2 cows averaged 135¢/kg.

There was a similar sized offering at Bairnsdale with some very good vealers penned. Heavyweight vealer steers to slaughter topped at 227¢ to average 219¢/kg. Heavy yearling steers to the trade were firm around 183¢/kg. Medium D2 cows were 2¢ dearer at 142¢ as the heavyweights gained 3¢ to 153¢/kg.

After Thursday's markets the Eastern Young Cattle Indicator (EYCI) finished 1.25¢ dearer than last week at 350.5¢/kg cwt. The trade steer indicator was 2¢ dearer at 190¢ and feeder steer 3¢ cheaper at 183¢/kg lwt. Japan ox and US cow were both steady at 182¢ and 137¢/kg lwt respectively.

There was a substantial increase in numbers at Wagga with around 12 000 more lambs penned. Trade lambs were $3 cheaper around $138/head or 532¢/kg cwt. Well finished Merino lambs were $2 to $7 dearer with heavyweight portion selling from $118 to $134/head. Well finished heavyweight pens averaged 519¢ to 531¢/kg cwt and an exceptional pen topped at $185/head. Merino sheep sold up to $11 dearer reaching $142/head.

 The eastern states restocker lamb indicator slipped 5¢ on a week ago to 530¢/kg cwt. Merino lamb was firm at 468¢ and light lamb 7¢ dearer at 490¢/kg cwt. Trade lamb settled at 542¢ being 3¢ up and heavy lamb gained 7¢ to 530¢/kg cwt. Mutton finished 2¢ stronger at 425¢/kg cwt.

A$ edging higher

18 June 2010

The past week has seen the A$ edge higher, as some confidence returned to global equity markets and signs that the Australian economy remained comparatively healthy. After pushing above 87US¢ early in the week, the A$ finished Thursday trading above 86US¢ - up 5% for the week.

After plunging over 12% in the second half of May, to below 82US¢, the A$ spent most of early June trading between 82-85US¢, as uncertainties continued to plague financial markets and debt concerns gripped European economies. However, compared with the same period last year, the A$ is still higher, averaging 84US¢ so far in June - up 5% on the same period last year (80.5US¢).

For the Australian red meat exporting sector, while the lower A$ has been welcome news, the full benefit of the fall has been somewhat offset by increased buyer hesitancy, given the volatility in currency markets.

Cattle market wrap

18 June 2010

Demand mixed with quality

Lower throughput this week at MLA's NLRS reported saleyards had a mixed impact on demand. While processors looked to secure orders, they faced solid competition from feeders and restockers, resulting in prices varying depending on quality and region.

There was a noted increase in the number of NSW restocker orders active at the Roma store sale on Tuesday, which helped boost the market for medium weight yearling steers - averaging 192¢, up 5¢/kg lwt. There was also an extra order in Scone looking for well-bred vealer steers to return to the paddock in western NSW. The extra competition resulted in medium weight vealer steers to restockers averaging 4¢ higher, at 206¢/kg lwt.

Overall, restockers were not prepared to pay last week's improved rates, with all prices slipping except for yearling heifers, which averaged 3¢ higher at 157¢/kg lwt. A dearer trend was recorded in NSW for the heifer portion, where producers looking for young cattle paid an average of 7¢ more for heifer vealers, averaging 175¢/kg lwt. Despite the higher NSW returns, the national average price for yearling steers slipped 3¢ compared with last week, to 172¢/kg lwt.

Processor rates also generally eased with quality playing a factor. The small numbers of prime finished young cattle available are being hotly contested by processors, butchers and wholesalers. B muscled vealer heifers to the trade made an average 4¢ more than last week with most pens selling around 204¢/kg lwt. Similarly, B muscle yearling steers to processors gained 2¢ to average 201¢/kg lwt. C and D muscled lots to slaughter could not maintain the same trend, with averages slipping 2¢ to 6¢/kg lwt. C muscle vealer steers to slaughter slipped 4¢, to 184¢ and D muscle yearling heifers were 6¢ cheaper, averaging 147¢/kg lwt.
Lot feeder saleyard prices remained firm, to slightly cheaper on last week's levels. Contract rates for cattle to be short-fed experienced a cheaper trend, with reports of young cattle exceeding the live export weight restriction heading south to be fattened on grain.

Public holiday cuts cattle yardings

The shortened trading week meant no Monday sales were held this week, except in WA. Consequently, national throughput at MLA's NLRS reported markets fell 19% compared to last week.

At Dalby, numbers fell 39%, after last week's lower prices discouraged some producers from bringing cattle forward. Numbers were also well down at both Roma and Mareeba, although Warwick experienced a slight lift.

Most yardings increased across NSW, with the exception of Inverell and Casino, with yardings dominated by young cattle. Scone and Singleton had the largest jump in numbers, as numbers returned to more normal levels.

In Victoria and SA, most yardings remained steady, with a few more offered at Wodonga and Leongatha, while numbers eased slightly at Naracoorte. Muchea on Monday had a larger offering, with very little quality on offer, except for a few supplementary fed young cattle.

US beefs up exports

16 June 2010

The value of US beef exports jumped 37% year-on-year in April to US$267.9 million, while volumes grew 30% to 58,982 tonnes. April export values were also 14% higher than in April 2003, the last year of pre-BSE market access conditions for the US beef industry (USDA, US Meat Exporters Federation).

Mexico and Canada remained the largest markets for US beef in April, taking 12,227 tonnes and 12,139 tonnes, respectively, valued at US$49.2 million and US$57.9 million. US exports to Korea (6,994 tonnes) and Japan (7,300 tonnes) continued to grow at a rapid rate, surging 287% and 28% year-on-year, respectively, although remain well below 2003 levels.

US beef exports for January - April totalled 215,929 tonnes, 24% more than the previous year. Despite this, the expectation is still for much lower US beef production this year and the next, based on the shrinking beef cow herd and the smallest calf crop in more than 50 years (CME's Daily Livestock Report).

The USDA has forecast beef production in 2010 to fall 1.8% on 2009 to 25.608 billion pounds, and for a further fall of 3.3% to 25.217 billion pounds in 2011.

Argentina to fall short on HQB exports

16 June 2010

Argentina will not fulfil their 2009-10 "Hilton" High Quality Beef (HQB) quota, and is only expected to export around 18,000 tonnes swt to the EU out of their total 28,000 tonne quota, according to the Argentinean government (Infocampo).

The shortage is anticipated despite the government's redistribution of 3,293 tonnes (from companies which recognised the inability to fill their respective shares of the quota) to interested exporters.

The low shipments over the fiscal year to date are the result of the delay in the distribution of the quota among local exporters (Argentina only commenced HQB exports in November 2009).

In addition, a shortage of heavy export steers and the government's export controls have made it increasingly difficult to ship product.

Since last week, exporters have been filling remaining contracts with air freighted shipments. However, according to industry sources, many exporters have admitted the inability to proceed with these shipments due to high costs.

Butcher carves up the Bega market

Retired Bega butcher Brian Sirl still clearly knows his beef according to a report in The Land after penning one of the top-earning lines of weaner steers at a recent Bega store sale.

That paper says that Sirl, who sold his Kydd's Butchery business eight years ago after 46 years in the red meat retail industry, saw his pen of eight Angus steers, aged 10 months, return $642.

During his time behind the counter Sirl says he would ideally get the steers from the "gate to the plate" at 200 kilograms dressed weight, saying it costs the same to break up a beast at 150 kilograms as it does at 200 "so it pays to have the weight in them".

Sirl currently carries 180 Angus breeders on his property Springbrook at Buckajo, near Bega and sells the majority of his turnoff through store and prime sales at Bega, saying he appreciates the five cents a kilogram feedlot premium paid for Angus.

Searching for sale solution

The Land says that groups at Yass and Goulburn are locked in battle to secure a multi-million dollar selling centre expected to change the face of livestock selling in the southeast of the State.

It's hoped any new centre will prove a lure for local producers, who are increasingly offloading their stock at saleyards such as the Central Tablelands Livestock Exchange (CTLX) "super yards" at Carcoar and Wagga.

In March proposals for a new $20 million saleyards complex in Yass received the support of local farmers and agents after a plan by Goulburn Saleyard owners Kattle Gear Australia to build yards for 2500 cattle and 20,000 sheep was rejected.

The paper suggests that proponents of the proposed Yass super yards are claiming that their centre, once operational, would attract as many as 150,000 cattle and a million sheep annually within four years.

MLA cooking up casserole demand

Meat and Livestock Australia (MLA) has a new campaign which is urging the nation's beef customers and consumers to see beef as the bright side of winter according to a report in The Land.

MLA last week rolled out its new beef casserole campaign across several media platforms designed to boost consumption in the winter months - it is the third year of a strategy to encourage consumers to build their beef skills and expand their casserole repertoire.

MLA marketing general manager David Thomason says marketing for lamb has mainly focused on getting it noticed through its Australia and Mother's Day and spring promotions.

But he says the issue for beef has not been getting it noticed but rather building householders' confidence in their ability to cook a greater range of beef dishes beyond the traditional roast or steak.

Casino's Amy is on a roll

Amy Morton can pick a beast likely to hit market specifications from a mile away according to a report in The Land - even if the animal in question is soaked to the skin by pouring rain.

The newly-crowned Casino Beef Week Queen is a qualified butcher and the paper says she is currently working as a specification co-ordinator at Casino's Northern Co-operative Meat Company.

So when she said the lineup of animals in this year's prestigious Beef Week led-steer competition were as well bred and high in quality as you would find anywhere, it was a fair bet they would go on to make good money.

But even Amy's professional breath would have been taken away by the $5 a kilogram top set by the 496-kilogram champion steer, which went to Atron Enterprises at Casino, with primal cuts headed for the restaurant market.

FMD - is Australia doing enough?

A national Rural Press report says that the Federal government is spending nothing extra on beefing up Australian borders in the wake of the devastating foot and mouth (FMD) disease outbreak in Japan.

While we have effectively closed our borders to all Japanese animals and animal products which could potentially be affected by the disease, MLA Japanese regional manager Glen Feist says reports on the toll to Japan's herd are greatly exaggerated.

He says that of the 200,000 animals which have been destroyed since March, about 150,000 of those are pigs and the country's highly-prized Wagyu herd is intact despite claims it has been destroyed.

The report says that with Japan's disease and quarantine standards once believed to have been considerably robust, this current FMD outbreak is being touted as an overdue "wake up" call for Australia.

Burke burrs up at quarantine calls

Federal Agriculture minister Tony Burke would not comment last week on the growing call for a review of Australia's besieged quarantine system according to a report in The Land.

Nor, the paper says, would Burke be drawn on what extra resources the government is committing to keep Australia free of the foot and mouth disease (FMD) which has now gained a strong hold in Japan.

It is believed that Canberra's only action since the Japanese detection of the disease has been the suspension of imports from Japan of animals susceptible to FMD and their products made after March 10.

Those products include genetic material, dairy products, hides and skins, and biological products produced from FMD- susceptible species. There are no imports of live animals or fresh meat from Japan or processed meat and dairy products for which there are already rules to manage FMD risk will be approved on a case-by-case basis.

Solid prospects for Terra Firma

After investing a reported $425 million in purchasing 90 pc of Consolidated Pastoral from the Packer family, The Land says Terra Firma, its new owners, finally dropped in to see exactly what they had got for their money.

Guy Hands founded Terra Firma in 1994, and has since built it into a $13 billion empire with investments ranging from alcohol to aviation - and now including some of pastoral Australia's iconic names, such as Newcastle Waters.

Twelve months since the acquisition has seen the country's ambition to become the number one beef producer following an unusual private-equity shakeup involving hiring additional staff rather than redundancies and buying more land rather than selling off assets.

The paper says that after the most recent property purchases by the group, and more expenditure on water, yards and fencing, the goal to reach 340,000 head will probably have been surpassed - and it won't stop there.

Angus brands build T&R sales

T&R Pastoral has made a strong push to value-add to its beef business by selling a large proportion of the 3000 head weekly kill through the company's five brands according to Stock Journal.

Despite a tough trading environment, South Australia's largest red meat processor's two premium brands - Certified Australian Angus Beef and Angus Pure - have been able to grow significantly.

In November 2008, T&R Pastoral became just the third licensed CAAB-accredited processor in Australia - and since then its has built the throughout from 80 head a week to more than 300 head a week.

These CAAB cattle are custom fed for 130 days at Wanderriby feedlot at Meningie before slaughter. And with the large numbers of Angus cattle in SA, T&R has been able to source most of its stock locally.

Rise of dark cutting costs SA producers

South Australian producers need to better manage pre-slaughter stress levels of cattle consigned to the Meat Standards Australia grading scheme because failure rates dueo to dark cutting are three times the national average says Stock Journal.

The paper says that the MSA livestock supply chain SA co-ordinator Mark Inglis has reported that the eating quality system has delivered about 10 cents a kilogram premium above the normal grid price.

But too many SA producers are missing out because of dark coloured carcases and Inglis says the local compliance rate could be improved by greater emphasis on nutrition and minimising pre-slaughter stress.

This year MSA is on track to grade 1.2 million head and between January 2009 and May this year 5.85 pc of carcases graded nationally had a pH greater than 5.7. But in SA that figure hit a staggering 15.38 pc.

Rumours rife over Twynam sale

Speculation is mounting that two large chunks of the Riverina property portfolio owned by Twynam Agriculture are about to change hands according to a report in the Weekly Times.

Rumours have become increasingly stronger that Macquarie Pastoral Fund's offshoot Paraway Pastoral will purchase Mungadal Station, near Hay, and Gundaline Station, near Carrathool although Twynam has denied them and Paraway refuses to comment.

Mungadal Station has been on the market since April 2008 when Twynam's other long-held Riverina properties Steam Plains and Cobran Station, were also listed for sale. Twynam owner John Kahlbetzer said then he would be the 100,000 hectare Gundaline Station.

One Riverina real estate agent told the paper it would "make sense" if Paraway Pastoral bought the stations, while another said it "would not surprise" him if the rumours of a forthcoming sale were true.

Prices near '05 record high

The coming winter could see young cattle prices return to the record highs of the red-hot 2005 season with prices already tracking eight pc ahead of this time last year according to a report in Weekly Times.

However, the paper says that much of the progress has been made on the back of the weakening Australian dollar, rising US prices, recovering feedlot demand and the widespread rain of last month.

According to MLA these factors have all helped to ease normal market pressure from pre-winter culling and, as such, have seen the Eastern Young Cattle Indicator pushed towards the 350 cent barrier.

Even more promising, the EYCI has lifted an average of 10 pc between now and its traditional winter peak in August for the past five years and if that repeats this year should see it approach 380 cents - its highest level since 2005.

Direct route for red meat

Red meat processors now have a growing number of retail outlets selling meat directly to their customers and Weekly Times says despite slow growth in domestic consumption of red meat, direct sellers are finding new markets with value-added and branded products and good old fashioned service.

Industry analyst Glenn McLeod from IbisWorld says consumers are shifting away from ready-to-eat supermarket meals and taking more of an interest in cooking at home, a trend amplified by the success of cooking show MasterChef.

With one pc growth expected in the specialty meat retail sector this year, McLeod says that is where specialty retailers might get ahead - in providing locally grown produce and more information about cooking it.

And with demand for "organic" red meat - meat from livestock not treated with antibiotics, growth promotants and other chemicals - expected to soar in the next five years, producers expect to see more niche meat brands gaining momentum.

Herd heads north

Victoria's biggest cowherd has been sold to Queensland says the Weekly Times with the sale of Werribee Agriculture's 5000-cow herd to a Queensland buyer finalised with all females expected to be delivered by the end of last week.

Werribee Agriculture, which until recently managed farmland at the Western Treatment Plant at Werribee, sold the Angus herd to Kilburnie Cattle Company which recently paid $12 million for the 600,000 hectare Mt Margaret Station at Quilpie.

Elders account manager George Last, who handled negotiations on behalf of Werribee Agriculture, confirmed the sale last week, saying he had been angaged by the company six months ago to sell the herd.

The paper says Kilburnie Cattle Co emerged as the buyer just one week after it was revealed the company had also bought Mt Margaret, which adds to their existing northern NSW holdings.

Angus hits new heights

There is no doubt Angus beef is on a roll - literally - through the McDonald's and Hungry Jack's fast food outlets as a key ingredient in their burger ranges according to a report in Queensland Country Life.

But now the rise and rise of Angus beef continues seemingly unabated, with the recent launch by Pattie's Foods, the company behind the Four 'n Twenty brand, a new meat pie range made with 100 pc Certified Australian Angus Beef.

And one of those on hand at the Brisbane launch at the Gabba was AFL star and Brisbane Lions veteran Jonathon Brown, who gave the Angus taste top marks while sampling his first bite.

In an exclusive agreement with CAAB, Four 'n Twenty will be the only meat pie licensed to use the certified Angus beef endorsement on its packaging - another rolled gold promotional opportunity for Angus beef.

Downs brand wins top prize

A Queensland beef brand underpinned by strong product integrity and meat science principles claimed the major honours in the 2010 RNA Branded Beef Competition says Queensland Country Life.

Darling Downs grainfed beef producer Stockyard Beef claimed the coveted grand championship - Australia's largest branded beef competition which is held as part of the Royal Queensland Food and Wine Show.

Eighteen of the nation's most prestigious beef brands, drawn from Queensland, NSW, Victoria, Tasmania and SA, vied for awards in four divisions judged by a panel of eight experts.

The paper says that the branded beef competition also serves as the opener for Brisbane Show's 2010 beef cattle program, which this year will kick off with the led steer judging on August 4.

MLA UPDATE

Live cattle trade to Indonesia

The number of import permits issued this year by the Indonesian Government is down on the same time last year as it tries to match its domestic demand with import numbers.

Restrictions have also recently been enforced to ensure that only cattle weighing up to a maximum of 350kg are being imported.

The 350kg weight restriction has been part of the Indonesian Government's decree since 2008 and is now being enforced as part of Indonesia's beef self-sufficiency goals, as well as to ensure the local Indonesian cattle industry can value-add by feeding the cattle they import locally prior to processing.

Industry is seeking to secure alternative live export and/or processed beef markets for cattle over 350kg that had previously been destined for export to Indonesia, but is confident Indonesia will remain a strong long term market for Australian cattle as we continue to support its local cattle industry.

Indonesia has indicated that Australian breeding cattle and feeder cattle (up to 350kg) will play a key role in helping to achieve its self-sufficiency goals as its population continues to grow by around two million people per year.

Finishing cattle drives higher prices and southern performance: ABARE

11 June 2010

Producers who finish their cattle on grain before slaughter typically have higher incomes than those who don't, and a much higher income per hectare operated, according to Australian Beef: Financial performance of beef cattle producing farms, 2007-08 to 2009-10, released this week by the Australian Bureau of Agricultural and Resource Economics (ABARE).

Excluding all commercial feedlots, i.e. operations which have over 1,000 head on feed for over 50 days each year, the report focused on northern (Queensland, NT and northern WA) and southern (NSW, Victoria, Tasmania, SA and southern WA) producers, finding that only around 5% of southern and 7% of northern beef producers finished cattle on grain over the period.

In the north, these producers tended to be concentrated around south-east or coastal Queensland where farms are relatively small in size, but close to sources of grain. The average feeding time was 85 days, which resulted in producers receiving an average price for cattle sold to slaughter of $884/head, 17% higher than their non-feeding counterparts.

However, grain feeding entails higher costs, which resulted in lower farm business profits and rates of return to capital for northern farms, relative to those that did not grain feed.

In southern producing regions, producers who grain-finished cattle tended to be on larger properties, with more cattle and a larger area sown to grain. Although they realised only 4% more per head at sale than non-finishers, at $716/head, they achieved markedly higher financial performance, measured by income per hectare, return on capital and overall business profit.

Korean short rib prices ease

11 June 2010

Average prices for Australian and US short ribs dropped in the Korean wholesale market this week - the first decline for 18 weeks. The average fall in short rib prices from both countries was approximately KRW500 (A$0.48). In contrast, prices for New Zealand short rib increased in Korea's wholesale market, possibly due to its relative price competitiveness over other suppliers.

Some market participants described the short ribs market as 'overheated' with soaring wholesale prices since the start of this year. Subdued beef demand during summer and stabilising short rib imports could be the cause of easing prices. Some Australian beef exporters stated that interest from Korea was slower this week on last, partly due to the ongoing volatility of the Korean won against the US$. The weakening won has been driven by concerns that Europe's debt crisis may derail the global economic recovery, triggering investors to hold on to US dollars instead of riskier assets (Bloomberg).

Lambs on a high, cattle solid

11 June 2010

Despite a 6% rise in yardings this week, lamb prices continued their winter march, led by finished categories. The eastern states trade lamb indicator is poised to break the record of 540¢/kg cwt set in late July 2004, ending Thursday at 539¢. The national heavy lamb indicator rose 8¢ this week, to 521¢/kg cwt, also close to the record week ending price of 529¢ set in June last year.  

The softening in cattle export demand from Indonesia and associated enforcement of the 350kg lwt import regulation has not noticeably impacted on national or state saleyard price indicators.

The national export cow price was steady this week, at 275¢/kg cwt, still up 5% on last year, with the Queensland price up 5¢ this week. The expected tight supplies of cull cows in most regions, stronger global manufacturing beef prices (especially from the US) and the recent easing in the A$ are expected to keep supporting cow prices.

Most other cattle indicators held steady this week, except for trade cattle in NSW, which appeared to have been impacted by the added numbers after last week's rain-affected turnoff. Restocker and feeder interest remains strong due to the rains and low grain costs.

Cattle market wrap

11 June 2010

Supplies return in the north

After a number of sales were reduced due to rain last week and with no sales next Monday due to the Queens Birthday long weekend (except in WA), supplies at MLA's NLRS reported physical market improved 11% week-on-week.

Numbers increased 20% in Queensland this week, after many producers in the south-east opted to hold cattle back last week hoping for rain, although most eventually missed out. There were more cattle brought forward at Dalby, and over 3,000 additional head yarded at the Roma store sale, with large lines coming from central Queensland near Aramac and from even further north around Winton.

NSW cattle supplies jumped 28%, with large increases at Wagga, Inverell, Casino and Gunnedah, although numbers were back around a third at Singleton where very few grown cattle were penned. In SA, 19% more cattle were penned, and despite overall quality being mixed with plenty of plain lines, there were some excellent supplementary fed yearlings which sold to strong competition. Going against the trend in the eastern states, Victorian offerings slipped 15% on last week, with most markets registering reduced numbers.

Yardings in WA decreased by 33% on last week, primarily due to a public holiday on Monday. Muchea held a sale on Tuesday which was well down, with a large supply of pastoral cattle and very few medium and heavyweight grown cattle supplied. Numbers were also down in Tasmania which is normal for this time of year.

Restocker activity up

Restocker activity increased this week following some handy falls of rain last week across Victoria and NSW, while the western districts of NSW still has plenty of feed available.

Despite a fall in the overall number of vealer heifers yarded, restockers increased their purchases by around 40% this week, with most sales steady on last week at around 170¢/kg. Vealer steers were sought after by producers, who increased their purchases by 38% on last week, prices increased on average by 2¢ in Queensland and 5¢/kg in NSW.

Yearling heifer numbers doubled, with most destined to return to Queensland paddocks, with a large proportion of lightweights offered at the Roma store sale, with average prices increasing 6¢, to 166¢/kg. It was a similar story for yearling steers, although the increase in price was not as large, with the average price around 175¢/kg.

The number of cows purchased to return to the paddock more than doubled, with most of the extra supplies out of NSW. Although average prices slipped in most states, an increase in SA helped keep the national average firm at 123¢/kg.

Cows dearer in the south

Overall cow numbers at MLA's NLRS reported saleyards increased 9% compared with last weeks offerings, with NSW and Queensland markets recording larger numbers, while fewer were yarded in Victoria, SA and WA.

Price trends varied depending on supply conditions in each state. In Queensland, processors paid around 6¢ less than last week, to 112¢/kg. Despite an increase in numbers, cows to slaughter realised similar rates in NSW, with most pens selling around 126¢/kg.

Fewer cattle in Victoria and SA, along with a public holiday next Monday, meant processors were willing to pay 6¢ and
5¢/kg more, respectively, for beef cows in a bid to ensure adequate numbers. Dairy cows to process were also dearer - around 8¢ dearer in SA and 2¢/kg in Victoria. Cows to slaughter in WA mostly sold around 110¢/kg which was firm on last week.

At the close of Thursday's markets, the eastern states US cow indicator settled at 137¢/kg.

Japan economy tough, but beef consumption firm at home

11 June 2010

Japanese families have been spending less on meat purchases, but eating slightly more beef at home, according to data by Japan's Ministry of Internal Affairs and Communications (MIC).

The average Japanese household spent 6,030 yen (A$70) on meat purchases in April, down 3.1% compared with the same time last year. The year-on-year fall has been consistent for the last 13 months, as the market suffers from persistent deflation. The latest consumer price index (April) fell 1.5% from a year ago, recording the 14th consecutive monthly decline. The government believes that the economy "has been picking up steadily" (May economic report by the Cabinet Office of Japan), but it still "remains in a difficult situation".

Per household beef expenditure has also been impacted by the slow economy, with average expenditure trending down year-on-year since December 2008. Beef purchase volumes, however, have exceeded the previous year for the last 12 months, with the latest April figure showing purchases averaging 565 grams per household (up 3.7% from 2009). This indicates soft but steady demand for beef among Japanese families, despite the deflationary economy and subsequent decline in beef retail prices.

There has been no evidence of reduced beef consumption due to the recent outbreak of foot-and-mouth disease in Japan. Yet, the trade is carefully monitoring consumer reaction, as the government works around the clock to contain the further spread of the disease.

Japan's new agricultural minister

11 June 2010

Japan's new Prime Minister Kan has formed a new cabinet this week, including the appointment of Agricultural Minister Masahiko Yamada - he is known for his long term commitment to food safety.

Yamada continues to be closely involved with foot-and-mouth (FMD) disease containment measures with his vice minister. The 280th case has been confirmed this week, all confined within the Miyazaki prefecture (southern Japan).

Interest in Australian beef from Japanese buyers varied from modest to firm this week, with some exporters reporting a slow, but gradual improvement compared with several weeks ago. However, interest in trimmings eased from last week.

Beef consumption in Japan during April eased 5% year-on-year, to 74,111 tonnes (boneless equivalent, estimated distribution volume data by Japan's Agriculture and Livestock Industries Corporation). The fall was largely due to reduced consumption of imported beef (down 7% to 42,847 tonnes), compared with the same time last year when the 'yen appreciation sale' was in full swing at both retail and foodservice, as a result of the A$ depreciation during early 2009.

US market cools

11 June 2010

The US imported and domestic beef market cooled this week, with indicative import prices for Australian 90CL beef back 2% on last week, to 155.5US¢/lb - the lowest weekly price since late February. Market indications are that while Memorial Day beef demand and sales were good, assisted by favourable weather, follow through sales have been surprisingly sluggish. However, the lower A$ has largely offset the 8% decline in US¢/lb terms since the start of May for 90CL beef, with prices in A$ terms only slipping 1.5% over the same period.

Argentinean beef supplies fade

10 June 2010

Argentinean beef production continued to tighten during April, as finished cattle numbers became increasingly scarce. April production declined 12% on the previous month and was 31% down year-on-year, at 198,000 tonnes cwt - the lowest level since the March 2008's agricultural strike.

The very tight supply of cattle has been reflected in soaring cattle prices, to the highest level among the South American region, reaching US¢180/kg lwt for light steer categories.

The low cattle availability is a result of the severe drought experienced during the 2008-09 season, combined with the industry controls implemented by the local government since 2005. This has resulted in a number of cattle producers liquidating herds and exiting the industry in favour of other more profitable agricultural options.

Argentine beef exports in April slumped 60% when compared to March and 75% year-on-year, to 6,836 tonnes swt. The slump in exports is the result of the limited issuing of export certificates by the government, in order to retain beef stocks in the domestic market, in addition to the closure of a number of plants given the current low capacity utilisation.

However, despite the government's efforts to encourage packers to supply beef to the domestic market through a number of controls and incentives, domestic beef consumption has fallen 20% during the first four months of 2010, to an estimated 56kg/head per annum.when copared to the same period in 2009.

Taiwan to inspect US slaughterhouses

10 June 2010

Taiwan, for the first time will conduct on-site inspections of US slaughterhouses that export beef to Taiwan, according to Taiwan's Ministry of Health (The China Post, 7 June).

Scheduled for August or September, the inspection will be undertaken to ensure that all US beef exports are adequately labelled and meet Taiwan regulations. The planned inspection is a response to a recent request from the US to speed up the customs clearance procedure of US beef in Taiwan.

Late last year, Taiwan's legislature revised laws to ban imports of certain beef products sourced from US cattle including skulls, brains, eyes and internal organs.

Hide demand quiet

10 June 2010

Overseas hide markets have been weaker this week, with export demand slowing significantly. Overseas buyers have indicated they have sufficient stockpiles and are now holding off purchasing further in the short term in anticipation of cheaper product. Domestic hides were firm to cheaper, with some assistance from the weaker A$. Wet blue hides were also cheaper this week.

April beef production steady as Victoria declines

09 June 2010

Australia's beef and veal production during April was steady compared with the same period last year, as a 2% decline in national slaughter was offset by higher average carcase weights. Production for the month reached 175,645 tonnes swt, with year-on-year increases in Queensland and NSW offsetting declines across the remaining states, with the main feature the continued drop in female cattle slaughter in Victoria (Australian Bureau of Statistics).

Adult cattle slaughter for the month declined 2% year-on-year, to 632,752 head, with Queensland throughput jumping 3% over the same period, to 295,525 head. For NSW, while total slaughter declined 3%, average weights surged 5% on the same period last year, or over 12kg/head, partly reflecting the improved seasonal conditions so far in 2010 across many parts of the state.

For SA and Tasmania, total turnoff for April contracted 8% and 9%, respectively, year-on-year, while numbers in WA were steady, at around 35,000 head.
Female slaughter cattle in Victoria continued to tighten in April, reaching only 62,813 head - back 31% year-on-year and the lowest monthly volume since July 2006. After a surge in female turnoff in 2008 and the first half of 2009, primarily due to drought induced liquidation and a sharp downturn in dairy returns, female slaughter rates in Victoria have been below year-on-year levels for the past 12 months. Indeed, for the past 12 months (May 2009 - April 2010) Victorian female slaughter totalled 898,000 head, a decline of 18%, or 202,000 head on the previous 12 month period (May 2008 - April 2009).

 Assisting the sharp contraction in female turnoff in Victoria over the past year has been the gradual depletion of available female numbers in previous years, better seasonal conditions and rejuvenated prospects for the dairy industry. With seasonal conditions across much of Victoria reasonable heading into winter, female turnoff is expected to remain tight for several months to come, especially if beef herd rebuilding gains momentum.

 For April, total Victorian beef and veal production declined 13% year-on-year, with average weights up 6%, at 256kg/head.

 For the first four months of 2010, total Australian beef and veal production was 4% below the corresponding period in 2009, with a 5% decline in adult slaughter partly offset by a 1% increase in average national carcase weights.

Korean cattle slaughter falls after five year growth

08 June 2010

Korean cattle slaughter totalled 252,318 head during the first four months of 2010 - a decline of 12% compared to the same period in 2009 (Nonghyup). With the decline in domestic beef production, demand for imported beef surged, rising 16% year-on-year (KITA).

Hanwoo (native) cattle slaughter for the first four months of 2010 dropped 11% year-on-year, to 198,298 head, as the industry dealt with foot-and-mouth disease outbreaks. Beef cattle (non Hanwoo breed) slaughter dropped 22% for the same period, to 32,975 head, while dairy cattle slaughter remained steady at 21,046 head this year (Nonghyup).

While total Korean cattle slaughter declined over the four month period, domestic chicken and pig slaughter increased 7% and 6% year-on-year, respectively (Nonghyup).

Riding the buck

A month ago the Australian dollar's seemingly unshakeable reputation as a star performer in the international currency arena was a nagging source of widespread farm sector anguish and expense says The Land.

But not anymore. Over the past two weeks that has all changed and the bullish currency's painful long-term squeeze on exporter margins and rural commodity prices has been bucked as our dollar made a sudden dive against its American counterpart, hitting its lowest levels in almost a year.

Analysts are now tipping the dollar to stay around the $US0.83 cent mark in the short term, albeit riding plenty of ups and downs along the way, possibly climbing towards parity with the US dollar again by next year.

The paper says it is the one market indicator Australian farmers are always happy to see head south and its present value is a far cry from the $US0.92 rate at the start of May - adding about $2 billion to Australian farm incomes over a year.

Why we need farmers

A report in The Land says Sydney's population is far less likely to understand how food is produced, the value of agriculture or what farmers do than in any other Australian city according to recent research.

The findings have alarmed the NSW Farmers Association, which is launching a major campaign to "sell" the image of farming and food production to "out-of-touch" metropolitan dwellers in Sydney, Newcastle and Wollongong.

MLA sponsored research shows at least two thirds of today's Sydneysiders aged 30 and under have never visited a farm and there is also genuine confusion amongst school children about how milk and meat products reach retail shelves.

One in five did not understand milk originated with cows, and not with milk-bottling factories. The campaign, expected to begin next month, is likely to have significant backing from one major TV network.

AACo's Wagyu windfall

Japan's foot and mouth disease (FMD) outbreak is proving a lucky early break for Australian Agricultural Company's beefed-up beef exporting plans according to a report in The Land.

With Wagyu beef exports now banned from Japan, AACo is already enjoying a sharp jump in orders to the US and Korean customers, whose supply lines to Tokyo have been cut off for an unknown period.

AACo managing director David Farley told the company's recent annual general meeting Wagyu is seeing increased prices and market opportunities - AACo's had jumped 18 pc that week alone - because of FMD.

Japanese authorities are now looking at a massive slaughter program, possibly as many as 200,000 head, because of the FMD outbreak. Farley, who has just returned from Europe, says even in these tight times Wagyu is selling at 198 pounds sterling a kilogram in Harrods.

AACo sets sights on new opportunities

Australian Agricultural Company, Australia's second-oldest company - is turning its attention to previously overlooked beef market opportunities in Asia says Stock and Land to help turn the business around.

After two turbulent years of boardroom instability, including five different chairmen in that time, the pressure to deliver a big lift in business performance is weighing heavily on the shoulders of new managing director David Farley and his team.

Getting greater value from carcase yield, including the market for offal, and using the market experience of AACo's Dubai-based shareholder IFCO, have become other growth strategies for Farley, who joined the company in December.

IFCO, the biggest red meat processor in India, holds a 10 pc stake in AACo and has extensive contacts in the Middle East. It plans to help open new markets in the region for AACo - Australia's largest beef business with 600,000 cattle - while Malaysian shareholder Felda is looking at a lotfeeding option alongside its palm-oil plantations.

T&R in supermarket push

Major South Australian red meat processor T&R Pastoral is continuing with its rapid expansion into the retail market according to Stock Journal with the launch of Thomas Farms - another new brand.

T&R is renowned in the State's livestock industry but is now hoping to build a similar profile among consumers across the nation with its range of high quality, consumer-ready beef and lamb products.

The paper says that in the past the company has been heavily dependent on its export operations, but its management is now hoping to build on its 20 pc share of sales in the domestic market.

About a month ago the first packets of Thomas Farms meats began hitting supermarket shelves across SA, the NT and Victoria, and the roll-out is planned to continue in other states in the coming months.

Indo-bound bull delivery

Another flight of export cattle has headed from Melbourne to Indonesia according to a national Rural Press report - and this time the cargo is 110 bulls for boosting the Indonesian herd.

Overseeing the shipment was Sustainable Agro Industry Service operations manager Brendan Head, who says the first stop for the draft of bulls was Surabaya, Indonesia's second-largest city, where half were unloaded.

Head says from there the bulls are headed for the nearby city of Malang, where the semen collection centre Singosari is based and once collected straws will be sold to villagers at $2 each - "which is a fair bit for them".

The second unloading was Jakarta, with those bulls headed for the old Dutch capital of Bandung, which is between 4000 and 5000 metres above sea level. And like the first lineup, they will be headed to a nearby collection centre.

Australian herd update

Recent data released by the Australian Bureau of Statistics (ABS) profiled the national beef cattle herd by Natural Resource Management Region (NRM) as at June 30, 2009, and reinforced Queensland's dominance says The Land.

According to the ABS the Australian cattle herd increased two pc in 2008-09 to 27.9 million head while for the same period the national sheep flock kept declining, down 5.4 pc to 72.7 million head.

The paper says that despite a nine pc contraction in the Fitzroy NRM region's (surrounding Rockhampton) cattle herd, it still held onto its title as Australia's largest cattle region with 2.6 million head.

The influence of drought, flooding and cattle movements throughout the year saw movement in the ranking of the next largest regions, with Burdekin jumping from fourth in 2008 to second with 1.7 million head and the NT (no NRM classification) fell one position to third with 1.68 million head.

Japan craving Australian beef

Despite recent reports to the contrary, other MLA sources say current interest out of Japan for Australian beef has nothing to do with a reaction to that country's foot-and-mouth disease epidemic, but is solely price related says Queensland Country Life.

The paper says that MLA Japan region manager Glen Feist says there has been a significant kick in demand for Australian beef - and much of it is in direct response to the falling Australian dollar.

Feist says there has been zero negative reaction from Japanese consumers about beef generally, as a result of the FMD outbreak and nor has there been any significant change in price for Wagyu beef or otherwise despite earlier reports.

As of last week Japanese authorities say a total of 19,303 beef cattle have been destroyed as a result of the outbreak, mostly being sound animals within a radius of infected animals culled as part of the process.

Pasture meets nutrition needs

Last winter was one of the driest on record in Central Queensland but thanks to deep ripping and conservative stocking, Brett McCamley did not have to supplementary feed breeders grazing these improved grass and legume pastures says a report in Queensland Country Life.

McCamley, a fifth generation cattle producer, recently hosted members of the CQ Beef Bajool group to inspect 324 hectares of coastal pasture development at the family partnership's Fern Hills Grazing Company at Fern Hills.

Department of Employment, Economic Development and Innovation FutureBeef extension officer Ken Murphy says through the government's FutureBeef initiative Bajool district members were able to share their livestock and resource management skills to achieve more profitable and sustainable businesses.

The CQ Beef project is just one of many nutrition, grazing, breeding and business management FutureBeef projects being coordinated statewide to improve the profitability and sustainability of the Queensland beef industry.

Obama to savour Aussie beef

US president Barack Obama's upcoming visit to Australia is likely to be memorable for a number of reasons says Queensland Country Life - just one of which will be the quality of the beef he eats during his time with Prime Minister Kevin Rudd.

Following approaches from Tasmanian MP Sid Sidebottom the paper says that it looks as though two of the Island's premium beef brands will grace the dining table at The Lodge during the Obama visit.

After accepting a trial sample of premium Tasmanian beef from Sidebottom, Rudd agreed subject to availability the government will use Tasmania's famed Cape Grim grassfed branded beef.

The paper says Cape Grim is arguably Australia's highest-quality grassfed beef product, consistently achieving MSA boning groups 1-4 off grass in heavyweight carcases averaging close to 380kg and displaying abundant marbling.

Russian taste of Queensland

Coinciding with the recent Brisbane visit by Russian Meat Importers chief Sergey Yushin was a local marketplace visit by a delegation of leading Russian chefs according to Queensland Country Life.

The paper says Russia is now the second biggest beef importing nation in the world - behind the Americans - and as such is increasingly being courted by Queensland beef exporters, already supplying more than half Australia's exports to Russia.

The chef group's tour included Swift, John Dee and Nippon processing plants, retail sites, restaurants and other points of interest before a showcase beef dinner put on by MLA, Trade Queensland and participating processors.

Yushin says it was a great opportunity for key stakeholders from the Russian restaurant industry to see what they could do with Australian product, which already has a strong reputation in the Russian market for quality and consistency.

US still grappling with E. coli

The E. coli season is upon the US industry again says Queensland Country Life and many there are holding their breath there won't be a spike in positives and recalls as seen in the past two years.

The season is a reminder that food safety and demand are the US beef industry's biggest issues and the two are strongly linked - as the 1993 Jack-in-the-box E. coli 157:H7 tragedy showed.

Beef recalls in the following decade cost the US industry $1.6 billion in lost demand and analysts say an even larger amount was likely lost in the past seven years due to E. coli recalls and concerns about BSE.

But there have been other costs which have impacted the industry more. The Jack-in-the-box tragedy set off a series of regulatory and other actions which cost the US beef industry at least $US850 million in the decade from 1993, sparking the closure of at least 18 grainfed cattle plants and 23 abattoirs.

Euro woes hurting beef business

When you think of Greece it is more about kebabs to kleftiko, not beef. But Queensland Country Life says each Greek eats an average 20kg of beef annually and its current economic crisis is hitting big producers such as Australia and the US hard.

Greece's debt crisis - and that of several other EU countries - plus concerns about the euro have global investors on edge and while the resulting falling currencies including our dollar may be good short-term news, it will make it increasingly hard to price product for forward sales.

The market jitters have already dealt a sharp blow to the US grainfed industry and are a reminder that outside forces, not supply and demand, are the greatest risk to the market going forward.

The June live cattle contract lost $4.12 per cwt solely because of Greece's problems. The big concern going forward is speculative traders - who had heavily bought US live cattle futures - might bail out of live cattle big time.

MLA UPDATE

Unchanged conditions in Korean wholesale market

4/06/2010

Similar to last week, Australian beef exporters reported on steady to slower demand from Korean traders this week. The high volatility of the Korean won against the US$ was mentioned as a possible cause for the ease in demand.

Prices for Australian short ribs in the Korean wholesale market remained steady this week - after gradual increases since late April. However, US short rib prices increased for the ninth consecutive week due to subdued supply. Prices for most other imported cuts remained unchanged.

Australian exports to Korea during May totalled 10,831 tonnes swt - a 36% increase on the same month last year and an 18% rise year-to-date compared with the same period in 2009. Chilled beef exports to Korea reported record volumes with 13,085 tonnes swt - up 27% on last year (DAFF).

Japan awaits new PM

4/06/2010

Japan's Prime Minister Yukio Hatoyama - whose support had dropped to a record 20% low recently - announced his resignation on Wednesday. The New Prime Minister is expected to be chosen by late Friday, followed by a formation of the new cabinet early next week.

As the ruling Democratic Party of Japan (DPJ) now fiercely focuses on winning the upcoming Upper House election next month, the political turmoil may delay decisions concerning key trade issues, including the US beef import negotiations.

In the export market, Australia sent 30,756 tonnes swt of beef to Japan in May, down 10% from 2009. Chilled beef shipments declined 15% year-on-year to 13,002 tonnes, largely due to stagnant demand on the back of the strong A$ (15% higher from 12 months ago against the US$). Frozen beef exports also eased 5% to 17,754 tonnes. Calendar year to date shipments totalled 144,341 tonnes, 2% below the same time last year.

Beef export trading this week was generally subdued, with export prices to Japan mostly unchanged in US$ terms (but lower in A$ terms due to the A$ appreciation). Some Japanese buyers were still keen to source trimmings, resulting in competition with the US market

Wholesale prices steady

4/06/2010

Beef prices at the Sydney wholesale meat market have been stable for most of 2010, following a sharp decline at the end of last year. Currently, beef prices are 9% below the same time last year, while lamb wholesale prices are 22% higher.

Wholesale carcase beef prices in the 180-220kg cwt bracket are currently averaging 345¢, compared with 390/kg cwt at the same time last year. Comparatively, 180-220kg cwt yearling steers selling over-the-hooks in NSW currently average 302¢, up from 279¢/kg cwt in the first week of June last year.

In recent weeks, top quality yearlings have been a little scarce as winter begins and all weights cleared early most days. This added some enquiry to the broken trade which ensured acceptable clearances. Prices remain stable and apart from the odd sale of choice lightweights which sold marginally better, all other sales recorded steady prices.

Currently, the average price for trade weight lamb whole carcasses between 20-22kg cwt is 635¢/kg cwt, compared with 520¢/kg cwt at the same time last year. Lamb prices in the equivalent weight range are averaging 485¢ direct to works, compared with 477¢/kg cwt last year, reflecting a more favourable situation for wholesalers this year.

Lamb demand continues to be strong, particularly for the limited supply of prime grades available. Rates this week continued on a dearer trend, with base prices up to 10¢/kg cwt higher. The broken trade was quite brisk early this week, but tapered off slightly later in the week. Quality has been good and this has ensured good clearances were maintained.

Cattle market wrap

4/06/2010

May cattle supply jumps

With significant rainfall only recorded late in the month and a turn in seasonal conditions towards colder temperatures, cattle throughput at MLA's NLRS reported markets during May increased 14% compared with the previous month.

All states except SA recorded a significant increase in numbers, with many SA producers having already sold cattle before shifting their focus to sowing winter crops. The yardings in all of the other states increased for the month, with many producers turning off cattle before feed deteriorated with the colder weather, and culling dry cows after preg-testing. In some areas, plainer cattle were forced onto the market, with a lack of suitable pasture and dwindling water supplies.

Supplies in Queensland increased 13% for the month, or just over 10,000 head, after a run of public holidays in April reduced yardings. NSW throughput jumped almost 20%; Victoria lifted 11% and WA 25%, with all states being affected by the Easter and ANZAC public holidays in April.

Despite most of May being dry and cool, good falls were recorded over much of the south east of Australia during the final week of May. The much needed wet that covered much of NSW and Victoria, but missed most of Queensland, contributed to numbers contracting 10% this week. The largest falls were in NSW, with the supply areas for Gunnedah, Tamworth and Inverell receiving up to 60mm.

Rain boosts prices

Competition at MLA's NLRS reported physical markets increased this week after rainfall restricted numbers and boosted restocker activity.

NSW experienced the greatest increase in average prices, with restockers paying an extra 8¢ for vealer heifers and around 180¢ or 4¢/kg lwt more for yearling steers compared with last week. Nationally, trade buyers also paid more, with less cattle meeting slaughter specifications offered this week. Vealer heifers made an average of 176¢, as yearling heifers were 2¢ dearer, to average 162¢/kg lwt. Feeders were also prepared to lift rates this week, sourcing yearling steers for an average close to 6¢ more at 178¢/kg lwt.

Cattle slaughter up in May

Cattle throughput jumped considerably during May, with weekly slaughter figures collected by MLA's NLRS indicating a 14% increase nationally compared with the corresponding period in 2009.

Limited supply of prime trade cattle and ongoing solid demand from restockers and feeders meant processors faced tough competition as they tried to secure adequate numbers after production shortfalls at the start of the year. However, they were assisted by more cattle coming out of central and western Queensland. NSW and Queensland slaughter figures for cattle were both up 17% year-on-year and SA 31%, while Victorian abattoirs reduced activities, killing 7% less cattle compared with the corresponding period last year.

Most direct to works rates lifted throughout the month, which reflected processor intentions to secure quality cattle, especially after the sharp fall in the value of the A$ and the low proportion of finished cattle at physical markets.

Keep your eye on US distribution centre sales

4/06/2010

The US manufacturing beef market continued to ease this week, as US traders wait for Memorial Day weekend sales performance before committing to new orders.

To gauge the success of the Memorial Day weekend beef sales, all eyes will be on distribution centre orders being placed (that deliver to both foodservice and retail customers) at the end of this week/early next week. The size of their beef orders over the coming week will likely dictate whether the market has already reached its peak in prices, or if prices will continue on to a market peak leading up to the 4th July holiday period.

Tight imported beef supplies will also support a rising market over coming months, as imports of US beef tend to seasonally decline in July and August.

Australia though appears to have recently ramped up exports to the US, with May data showing the highest monthly volume sent to the US in 12 months, at 23,871 tonnes swt (although this volume is steady on the same time last year). Imports from Canada and Mexico remain above year ago levels.

Markets begin winter price run

4/06/2010

The seasonal May/June cattle price low appears to have passed, with markets again boosted by widespread rains this week.

Lower yardings and good restocker and feeder interest saw rises across the young cattle categories this week, with the EYCI lifting 4.5¢, to 349¢/kg cwt (8% higher than last year). The drop in monthly average prices between February and May was minimal this year (1% for the EYCI), as a falling A$, rising US prices, recovering feedlot demand and May rains helped to ease the normal market pressure from pre-winter culling.

Over the past five years, the EYCI has lifted 10% between May and its winter peak in August. If this occurs again this year, the EYCI would approach 380¢/kg cwt by August - its highest level since the records of winter 2005.

The impact of this week's rains on sheep and lamb markets has been even more pronounced, following a 10% fall in lamb yardings and almost 20% for sheep. Most prices lifted by around 3%, and a fall in yardings of Merino lambs saw prices up 6% for that category.

With sheep yardings now almost 60% lower than a year ago, and strong restocking interest, prices again posted record levels, with the national indicator at 411¢/kg cwt by Thursday, 50% higher than a year ago.

OIE grants Korea a controlled risk status for BSE

3/06/2010

Korea has been internationally recognised as a "controlled risk" country for bovine spongiform encephalopathy (BSE), or mad cow disease, by the world organisation for animal health, OIE (Chosun Ilbo).

The new status means that Korea is considered to have adequate surveillance for the disease and the ability to prevent an outbreak of the disease - through extensive supervision of animal feed and quarantine measures from breeding to processing cattle (Dong-Ah Ilbo). The ruling means that Korea will be allowed to export beef to countries where import policies follow OIE standards.

While acquiring the new BSE status, Korea has been battling with foot-and-mouth disease (FMD) this year. The last outbreak of this highly contagious virus was reported on 7 May, with 11 outbreaks since the disease reappeared on 9 April this year. However, the head of the OIE said that Korea is now controlling the FMD virus (Agra-Net).

Beef exports hit 14-month high

3/06/2010

Australian beef exports continued their steady recovery during May, hitting a 14-month high, with increased shipments to the US, Russia, Korea and Taiwan. Exports for the month, at 85,762 tonnes swt, were up 4% year-on-year, assisted by higher cattle slaughter since late April and a drop in the A$ throughout the month.

A feature for the month was the increase in exports to the US, at 23,871 tonnes swt - the highest monthly volume since May last year and 45% above average shipments in March and April. However, while shipments for the month were assisted by more lucrative returns from the US, with import prices averaging 12-30% higher year-on-year for manufacturing beef products, shipments for the month were still comparatively low historically, down 15% on the average for the past five years.

Reflective of a very slow production start to 2010, Australian beef shipments to the US were still 35% below year ago volumes for the first five months of 2010 - still the lowest level since 1996.

After a relatively steady March and April, exports to Japan for May declined 10% year-on-year, to 30,754 tonnes swt. Trade conditions to Japan remain tough, as the economy and consumer demand continues to struggle. However, a reduced supply of grainfed cattle impacted shipments for the month, with total grainfed beef shipments falling 12% year-on-year, with chilled shipments back 18%.

Korea continues to be a robust market for Australian beef in 2010, even with increased competition from US beef. Exports for May reached 10,831 tonnes swt, an increase of 36% year-on-year, with exports for January to May up 18% on the same period last year.

Despite some reports of sluggish buying early in the month, Australian beef exports to Russia reached 4,988 tonnes swt during May, as supplies from traditional South American suppliers continue to remain tight, namely Argentina.

Taiwan and the Philippines were another two markets to record an increase in Australian shipments during May, up 18% and 29% year-on-year, respectively. Shipments to Indonesia have cooled off in recent months, with exports for May back 18% year-on-year, to 2,490 tonnes swt.

For the first five months of 2010, Australian beef and veal exports were back 9% year-on-year, at 348,883 tonnes swt.

Australian consumer confidence drops

3/06/2010

Australian consumer confidence decreased 8.1 points in a week to 115.1 points on the weekend of 22-23 May 2010. Despite the fall, the consumer confidence index remained 10.9 points higher than a year ago, according to the weekly Roy Morgan Consumer Confidence Rating.

Driving the fall were the large falls in four out of the five components of the confidence index following the turmoil in global stock markets. Sharp falls in the Australian stock market, the A$ and the continued debate about the government's proposed mining super profits tax also contributed to the softer sentiment.

According to Roy Morgan, the biggest driver in the fall was the falling confidence about the year ahead, with only 36% of Australians (down 6 percentage points) expecting ‘good times' for Australia as a whole over the next 12 months and only 38% (down 6%) of Australians expecting their family to be ‘better off financially' this time next year.

Japan economy tough, but beef consumption firm at home

3/06/2010

Japanese families have been spending less on meat purchases, but eating slightly more beef at home, according to data by Japan's Ministry of Internal Affairs and Communications (MIC).

The average Japanese household spent 6,030 yen (A$70) on meat purchases in April, down 3.1% compared with the same time last year. The year-on-year fall has been consistent for the last 13 months, as the market suffers from persistent deflation. The latest consumer price index (April) fell 1.5% from a year ago, recording the 14th consecutive monthly decline. The government believes that the economy "has been picking up steadily" (May economic report by the Cabinet Office of Japan), but it still "remains in a difficult situation".

Per household beef expenditure has also been impacted by the slow economy, with average expenditure trending down year-on-year since December 2008. Beef purchase volumes, however, have exceeded the previous year for the last 12 months, with the latest April figure showing purchases averaging 565 grams per household (up 3.7% from 2009). This indicates soft but steady demand for beef among Japanese families, despite the deflationary economy and subsequent decline in beef retail prices.

There has been no evidence of reduced beef consumption due to the recent outbreak of foot-and-mouth disease in Japan. Yet, the trade is carefully monitoring consumer reaction, as the government works around the clock to contain the further spread of the disease.