Winter spike passes

The annual winter spike in prices for cattle seems to have passed early according to a report in the Weekly Times, with just a slim possibility that rates could again increase in late August or early September.

While prices normally reach their peak in late winter, as the southern cattle turnoff declines, a rising, or at best volatile, Australian dollar is likely to suppress any such impact MLA says.

Already the appreciating Australian dollar is placing pressure on steers bound for Japan, with the national Japan ox indicator last week slipping nine cents a kilogram to 319 cents carcase weight.

Although this was compounded by ongoing poor Japanese demand, the paper says trade cattle values in Queensland and NSW rose, while cow prices lifted in NSW and WA and the Eastern Young Cattle Indicator was 11.5 cents ahead of the same time last year.

Egypt market gets lively

Egypt is re-emerging as a major export destination for live cattle following Indonesia's decisions to close its ports to Australian cattle heavier than 350 kilograms says the Weekly Times.

The paper says that Australia's largest livestock exporter and ship owner, WA-based Wellard Rural Exports, has announced that it will send four shipments of beef cattle to Egypt this year.

Two of those shipments, with a combined total of 33,500 head, have already been delivered - with one of them sailing from Fremantle in WA and the other from Townsville in Queensland.

They were the first shipments there in five years following the introduction there of an improved animal welfare code, and Wellard managing director Steve Meerwald says the revival of the Egyptian market is significant given the Indonesian situation.

Top End prices ‘polarised'

The 350-kilogram liveweight limit imposed six weeks ago by Indonesia on Australian live cattle exports has had a dramatic effect on cattle prices across supply areas in northern Australia says Queensland Country Life.

Steers below the 350-kilogram weight threshold have risen to 190 cents a kilogram liveweight ex Darwin, up from 160 cents before the ban, and live export analysts say could soon push through the 200 cents barrier.

But in contrast, values for heavier cattle now outside Indonesia's live export requirements have fallen substantially, and that's before the application of road freight, which can add as much as $200 to costs for northwest WA cattlemen.

MLA live export manager Michael Finucan agrees the beef cattle market has been polarised and says live export buyers are now sourcing their cattle from within a smaller available pool so there is going to be some upward pressure on prices.

Katherine Meatworks hopes dashed

Prospects for the reopening of the Katherine Meatworks as a local processing option for northern Australian cattle falling outside weight requirements for Indonesia have been dashed says Queensland Country Life.

The paper reports that the backers for the project have confirmed in the past week that their plan has been abandoned, primarily they say because of the lack of government, and other, support.

A group headed by processing industry veteran John Hughes, and an Australian partner (not Chinese, as earlier rumoured) had worked on a plan over the past two years to get the plant back on its feet, with considerable support from Teys Brothers, its current owners.

While the original proposal was built around the processing of feral animals such as camels, buffalo and donkeys, more recently the changing Indonesian market has seen attention switch to a beef kill for cattle above 350 kilograms.

Saleyards muster national voice

Years of negotiations came to a head last week says Queensland Country Life when saleyard operators voted to form a new peak representative body at the annual Saleyard Operators of Australia (SOA) conference in Wagga Wagga.

Yard representatives from Queensland, NSW and SA voted together to form the Australian Livestock Markets Association (ALMA) and replace the SOA with a yard-based organisation.

The paper says that inaugural ALMA president Steve Loane, from Naracoorte in SA, says it has become very clear that they needed to become a national peak body so they could be heard in government.

Loane says the issue has been simmering for a couple of years, but in 2008 when Federal Agriculture minister Tony Burke said he wanted guidance, but only from a peak industry body, the issue regained momentum.

Texas Longhorns expand

It might still be an under-appreciated breed in Australia says Queensland Country Life, but a handful of commercial producers across Queensland and NSW are dedicated to lifting the profile of Texas Longhorn cattle.

According to the paper, converts to the breed say that they believe it offers many individual benefits and they are bracing themselves to enter the competitive breed promotion marketplace.

Formed in 2008, Texas longhorns Australia (TLA) is an organised outlet to promote and educate people on the Longhorn breed and to unit Longhorn breeders and enthusiasts.

About 50 Longhorn producers met during the inaugural Texas Longhorn sale, which was held in Gunnedah last month, and decided to become an incorporated organisation with its committee meeting at Deepwater next month.

Not-so-humble pie

Angus beef's fight for an ever-increasing market share has spilled out of the burger range and into flaky pastries with the launch of a new Angus pie from the Brumby's bakery chain says Queensland Country Life.

The paper says that with scant change from a $5 note, the premium-priced pie seems to be pitted against its more fancied, and famous, rival recently launched by the iconic Four'n'Twenty company.

This meat pie scrap now looks set to resemble the burger war (is this called a bunfight?) between McDonald's and Hungry Jacks, both slugging it out with their respective Angus burger items.

Of course, the paper rightly points out that the biggest winners are those behind the Angus brand, along with its rapidly-expanding capacity to extract more of the consumer's grocery dollar.

Tamworth's big new ‘less stress' saleyard

People will be buying and selling livestock out of an all-new complex in Tamworth - and according to a report in The Land it could all be taking place as soon as October next year.

Tamworth Regional Council approved the amended development application by Regional Infrastructure earlier this month, smoothing the way for construction to start as soon as October this year.

The new complex will be on an adjacent greenfields site, literally around the corner from the existing Goddards Lane facility and the approval brings to an end six years of industry speculation for those who use the yards and uncertainty for those who are working in them.

The paper reports that the new Regional Livestock Marketing Centre has been designed to handle 130,000 cattle and 355,000 sheep and lambs annually, or about 1950 prime cattle, 650 stores and 7100 sheep a week.

MSA booming as Swift processors jump aboard

A big contributor to the recent Meat Standards Australia (MSA) boom - up 28 pc to more than 1.25 million last year - has been Swift Australia, which The Land says has now completed MSA licensing in all seven of its Australian beef plants.

The paper says that Beef City near Toowoomba started grading 100-day cattle in the past two months, while Brooklyn in Victoria and Rockhampton are close to starting their first MSA kills.

Brooklyn is also about to launch its own grassfed halal-certified brand called Royal Blue, adding to Swift's existing four MSA-back brands, and other Swift plants are extending their MSA ranges.

Dinmore, for example, has this year grown from 70-day grainfed MSA only to both grass and grain finished cattle. Evidence from through-chain premiums for MSA meat and livestock are further lifting interest from producers nationally.

Key to cycle success

In modern beef production, getting females to cycle is critical to getting more calves on the ground, and, ultimately, more dollars in the bank according to a report in The Land.

Keeping females in good condition, particularly at calving and weaning, and sticking to a regimented start to mating, are among the keys in ensuring the cycling success in a herd says DEEDI principal scientist Geoff Fordyce.

And they were among the messages he and other researchers delivered at a breeder reproductive performance and management field day organised by the Central Beef Alliance at Springsure.

Fordyce told participants at the field among the tools they can use is their breeder reproductive management is the five-point scoring system starting at one being very poor through to five being very fat.
 

Argentine farmers pay for populism

Farmers in Argentina - a country known for its wide open spaces and productive farming and livestock industries - are struggling with the effects of exorbitant export taxes says The Land.

The Argentine undersecretary for Agriculture, Fishing, Livestock and Food between 1999 and 2001, Jorge Cazenave, says the taxes started in 2002 and have been going up ever since.

Using soybean as an example, Cazenave told the paper that export taxes were 27 pc in the 2007 planting season. They jumped to 37 pc in the following year and by the middle of that year had hit 45 pc.

He says beef is also being hit, and as a result much of its market share in areas such as Russia, the EU, Arab countries, Africa and Asia are being lost to Brazil and the country's cattle herd has been slowly dwindling since 2002 with slaughterings in 2010 expected to be down 30 pc.

MLA UPDATE

Price premium for MSA beef in 2009-10  :  23 July 2010

The average price premiums for butchers and wholesalers selling MSA beef during 2009-10 were steady compared with the previous year, according to data collected by Millward Brown's National Field Services.

The firm price premium, an increasing proportion of butchers (37%) and wholesalers (88%) selling MSA graded beef and a 27% jump in the number of MSA graded cattle (to 1.25 million head) indicates strong demand for MSA beef during 2009-10. The growing momentum of the MSA grading program continued in 2009-10, with the majority of beef processors applying MSA as the minimum standard to underpin the eating quality of some or all of their brands.

Over the 12 months to June, the wholesale price for MSA-graded grainfed yearling cuts was 14% higher than the non-MSA equivalents and MSA yearling grassfed prices were 16% higher than the non-MSA cuts.

At retail, the price charged for MSA graded steaks was, on average, 7.5% higher than non-MSA steaks in 2009-10 - compared with an 8% premium in 2008-09.

Cattle market wrap :  23 July 2010

Yearling steer numbers surge

With rain reduced yardings across many regions last week, throughput at MLA's NLRS reported physical markets increased 13% this week. Despite the higher offerings, supplies remain 7% below the corresponding week last year.

While offerings surged across most categories this week, the largest increase was registered for yearling steers. Around 32% more yearling steers were offered on last week, with the majority of the increase coming from Queensland markets. Numbers were also higher in NSW and SA. Supplies of yearling steers were up in WA, although it was a very mixed quality offering at Muchea, where the limited number of certified grain fed lots offered were in strong demand from processors, reaching 219¢/kg lwt.

While the quality of yearling steers offered remains mixed, as is often the case in the middle of winter, there has also been a noticeable improvement in quality at some saleyards, with crop finished and supplementary fed lots entering the market. The supply of lightweight C2 yearling steers increased 56%, with restockers accounting for most purchases at prices around 193¢/kg lwt. There was a 36% increase in the number of heavyweight C3's offered, which sold to strong competition from feeders and processors, gaining 4¢ on last week to average 184¢/kg lwt overall.

Grown cattle dearer

Export categories registered stronger prices this week across all eastern states indicators.

The Japan ox indicator lifted 6¢ to settle at 183.7¢/kg lwt after Thursday's markets. The higher level was driven by the two Toowoomba markets where the indicator grades averaged from 187¢ to 190¢, while Japan Ox prices in Mount Gambier averaged 195¢/kg.

The US cow indicator finished 6¢ higher this week, at 141¢/kg lwt. Victorian and SA markets averaged from mid-140¢, to 155¢/kg lwt at Pakenham for D3 medium weight cows. At Dubbo, indicator grades averaged 148¢/kg lwt.

EYCI surges to 2010 high

At the completion of Thursday markets, the Eastern Young Cattle Indicator (EYCI) settled at 358.75¢, up 8.50¢ from the previous week and 15.75¢/kg cwt above the same time last year.

This week's increase eclipsed the previous 2010 high set in mid-March, when cattle supplies were severely restricted by flood conditions across Queensland and parts of NSW and is the highest daily level since early October 2008.

The rise in the EYCI was despite a 10% increase in the number of cattle included. Dubbo was the largest contributor, where feeder and restocker buyers were noticeably stronger.

Restockers pushed medium weight vealer steer prices up to 18¢ higher, with a top of 222¢ and an average of 214¢/kg lwt. Feeders paid up to 207¢ for lightweight yearling steers, with the average at 199¢, while restockers paid around 205¢/kg lwt for similar lines.

Heatwave signals arrival of barbecue season in Japan :  23 July 2010

A series of heatwaves hit Japan this week, straight after the end of the rainy season. The Japanese trade now anticipates a lift in barbeque demand in the market - outdoor beer gardens with barbecue facilities typically operate at full swing until the end of summer (early to mid September).

In the Japanese wholesale market, chilled Australian beef prices were mostly unchanged from last week, with the exception of tenderloin (down 5% to 2,050 yen/kg, but still 21% higher year-on-year), and cube roll (down 4% to 1,300 yen/kg, and 2% below last year), both grassfed. US chuck rib was in good demand, lifting 50 yen/kg up from last week to 1,225 yen/kg this week (choice grade).

Japanese buyers were not in a big hurry to secure chilled Australian products, despite the lower A$ this week. Interest in frozen items was more immediate, with trimmings and briskets attracting good bids from Japan.

First signs of lift in cattle demand :  23 July 2010

Cattle prices lifted across both saleyard and direct to works selling this week, providing the first signs of a possible lift in end user demand.
With yardings up 13% on last week (but still down on last year), it was a strengthening in the competition between restockers, feeders and processors that led to the rise across almost all categories and states. This competition was most clearly reflected in the EYCI, which finally broke away from the 350¢/kg cwt level it had maintained since early March, up almost 9¢ to 358.75¢.

The US import market is showing positive signs, feedlots are still placing cattle in pens for end-of-year Japan and Korean demand, and the recent rains have reinforced expectations of a good spring (further encouraging restockers).

The normal August/September peak in cattle prices is, however, likely to be constrained by the high and volatile A$ and continued economic concerns in Japan and the US markets.

Despite a small fall in lamb yardings, prices slipped slightly across national indicators this week, with the notable exception of Merino lambs in NSW and WA, which lifted on the back of last week's useful rains in the wheat/sheep regions.

NSW buyers managed to pull mutton sheep prices back 28¢ from last week's record, causing the national indicator to also fall from its record.

Australian foodservice on healthy growth :  21 July 2010

The latest MLA Australian foodservice tracking survey and ABS statistics revealed that Australian foodservice market value reached A$38.9 billion in 2009, growth of 8.1%, after the minimal 0.5% growth in 2008. Taking into account an average 3.5% increase in foodservice prices,

Australian foodservice sector's increased 4.6% in real terms in 2009 - above the annual 3% average real historical growth since 2001.

While the highest growth in 2009 was in takeaway foodservice outlets (+15.8%), there has been a significant turnaround amongst cafes & restaurants (-3.8% to +5.8% in 2009).

Factors contributing to the growth include the return to buoyancy in household incomes and assets, historically low interest rates, healthy employment levels, government stimulus spending and the stabilisation of financial markets.

ABS turnover data indicates foodservice growth during January to April 2010 has slowed from December 2009, although it remained above the same period last year. According to the MLA Australian foodservice tracking survey conducted in May, poultry continued to be the most served meat in foodservice outlets (83.5kg/outlet per week), followed by beef (73.7kg/outlet per week), lamb (31.5kg/outlet) and pork (27.8kg/outlet).

The Australian foodservice survey during May 2010 involved 431 telephone interviews across hotels/motels, restaurants, pubs/clubs, fast food chains and independent fast food outlets in Sydney, Melbourne and Brisbane/Gold Coast.

Around 55% of foodservice operators in this survey described themselves as 'doing OK', followed with 27% 'thriving' and 16% reportedly 'slow or struggling'. The overall results showed only minor changes compared with the November 2009 survey, but were better than May last year, when the economy was in the depth of the global financial crisis.

Korean enquiries yet to recover :  23 July 2010

Australian beef exports to Korea from 1 - 19 July totalled 7,585 tonnes swt with chilled beef making up 24% (DAFF). Beef trade with Korea has been firm this month, but Australian exporters have reported slowing enquiries in recent weeks.

Slow Korean consumer beef demand and strong supply has triggered wholesale prices for some imported beef cuts to fall.

Since the start of the FIFA World Cup last month, several Korean news sources continue to report on soaring chicken demand. The Korean Chicken Council expects consumption to hit 618 million chickens this calendar year compared with 564 million last year (Joong Ang Daily). A popular chicken dish is 'samgyetang' - a traditional Korean soup that is enjoyed during summer. Korean discount retailers E-Mart, Lotte Mat and Homeplus have also reported increased chicken sales year-on-year (Joong Ang Daily).

June marked the fifth consecutive month that total sales at discount retailers increased on last year. Groceries - making up 51.1% of all purchases - jumped 5% in the year to June (Yonhap). The Bank of Korea has also increased its gross domestic product (GDP) growth forecast from 5.2% to 5.9% - partially due to increased consumer spending (AP).

Australia continues to dominate Korean beef market :  23 July 2010

Korean imports of Australian beef over the January to June period increased 8% year-on-year, to 65,002 tonnes swt. Chilled and frozen beef imported from Australia increased 23% and 4%, respectively, this year. Australian beef continues to be dominant in the imported Korean beef market - supplying 78% and 47% of all imported chilled and frozen beef cuts, respectively.

Over the period, total Korean beef imports lifted 21% to 124,668 tonnes swt compared with last year. So far, beef imports have surpassed last year's monthly totals - assisted by subdued domestic cattle slaughter.

Beef imported from the US in the year to date increased 57% on last year to 37,591 tonnes swt. Beef from the US into Korea consists of 90% frozen (mainly barbecue) products. New Zealand volumes increased 17% from January to June, to 20,555 tonnes swt - with frozen beef accounting for 97.5% of total shipments.

Japanese cattle farm numbers in decline :  21 July 2010

The Japanese beef cattle herd decline slightly in 2010, while average beef cattle numbers per farm increased due to a reduction in the number of farming households.

According to data released by Japan's Ministry of Agriculture, Forestry and Fisheries, there were 2.89 million head of beef cattle as of 1 February 2010, down 1% from last year. Kyushu (southern island of Japan) remained the largest region for beef cattle in Japan at 1.06 million head (mostly Japanese black Wagyu), followed by Hokkaido (northern island of Japan) at 0.54 million head (combination of Wagyu, F1 and dairy beef cattle).

Farm numbers continued to decline, largely due to the aging farming population and the industry consolidation. As a result, 74,400 farms (down 4% year-on-year) had an average 39 animals/farm in 2010 (one animal more than the previous year). In reality, over 52% of the total herd was fed by larger beef cattle operations, with more than 200 animals - only 3% of total farms.

The figures were taken prior to the foot-and-mouth outbreak in Japan (April 2010).

US beef market steady but economy on uneven ground :  23 July 2010

The lean manufacturing beef market in the US this week remained relatively steady across imported and US domestic product, amid a cautious buying environment due to much market uncertainty. Both the importer 90CL indicator and the US domestic fresh 90CL indicator remained relatively unchanged on last week, at 155.5US¢/lb (CIF) and 166.5US¢/lb, respectively.

While there were expectations for the US economy to start its slow recovery, recent US unemployment figures suppressed all positive expectations for a strong recovery, with the US unemployment rate in June at 9.5% - unchanged on June last year, and a slight decline from May's 9.7%. Alongside this, the US GDP growth for the first quarter of this year was revised down from 3.2% to 2.7%, with calendar year figures now down to a range of 3% to 3.5%.

The sluggish economic growth in the US and high employment looks likely to continue to limit beef demand at both retail and foodservice for the rest of this year.

US eyes North Asia prize :  23 July 2010

US beef shipments to Japan in 2010 continue to gather pace, with exports in May jumping 10%, to 13,250 tonnes cwt. US imports are currently restricted to beef from cattle less than 21 months of age. Since March, monthly US cattle placements into feedlots have been above year-ago levels, increasing the availability of eligible cattle for the Japanese market.

US beef exports to South Korea during May increased three fold on the same time last year, accounting for more than half the overall growth in total US exports during May. Beef shipments to South Korea in May totalled 12,899 tonnes cwt - the highest May shipment since the occurrence of BSE in the US in late 2003.

The growth in exports to north Asian markets so far in 2010 has been offset by falls to the US's largest beef export market, Mexico. US beef consignments to Mexico have declined for the fifth consecutive month, with exports in May down 14% year-on-year, to 18,017 tonnes cwt. High US cattle and beef prices and a stronger US$ against the peso continue to impact on the US beef trade to Mexico.

Taiwan culls nearly 14,000 goats in pox virus outbreak :  21 July 2010

Approximately 13,976 goats from 127 Taiwanese goat farms were culled as at 19 June, as the spread of goat pox virus has yet to subside since the discovery of the outbreak in April (Taiwan News).

According to the Taiwanese Council of Agriculture, around 230,000 doses of vaccinations have been purchased to immunise the remaining 220,000 goats currently raised in the country. The goat pox virus is known as a highly contagious disease of small ruminants, characterised by fever, ocular and nasal discharges, but does not infect humans and can be destroyed at high temperatures.

The outbreak has not affected goatmeat prices in Taiwan, as domestically raised goats contribute only about 12% to domestic consumption. In 2009, almost 90% of goatmeat consumption in Taiwan was imported, with Australia's dominating the market.

During the first half of 2010, Australia exported 1,850 tonnes swt of goatmeat to Taiwan, up 12% compared with the same period last year, despite high prices affected by tight supply and the stronger A$.

Imported beef consumption eases in Japan :  21 July 2010

Japan consumed 61,152 tonnes (boneless equivalent) of beef in May, up 3% compared with the same time last year (data by the Agriculture and Livestock Industries Corporation of Japan, ALIC). Imported beef consumption declined by 2% from 2009 to 30,737 tonnes.

The lacklustre performance of the Japanese foodservice sector in May - total sales were down 1.7% year-on-year -combined with the increased import costs of Australian beef, contributing to the subdued consumption. The import value (CIF) of Australian beef during March to May averaged 408 yen/kg, up 9% compared with the same period last year. The A$ during the same period, appreciated 13% against the Japanese yen, year-on-year.

In contrast, consumption of local Japanese beef increased 9% year-on-year in May to 30,415 tonnes. Plentiful supply and slow consumption lowered Japanese beef carcase prices, resulting in reduced retail prices during the month.

Beef ‘back to school' in the Philippines :  21 July 2010

As students in the Philippines entered a new school year in June, demand for Australian manufacturing beef increased, due to the volumes of beef used for traditional beef school meals, including beef burger, corned beef and beef hotdogs.

While most consumers are reportedly withholding spending to accommodate tuition fees and other school needs in June, fine-dining restaurants in the Philippines have offered various promotions to assist sales and are using alternative cuts to ease margin pressure.

Wholesale prices for chilled Australian tenderloin averaged 1,390 Peso/kg (A$34.71) in July, while equivalent chilled US tenderloin prices sold at a premium, averaging 1,850 Peso/kg (A$46.19). Prices for chilled Australian rump registered 480 Peso/kg (A$11.99/kg) unchanged from July last year.

At retail, sales of Australian beef over the two months to July were assisted by an increasing number of modern retail stores offering Australian product, despite Australian beef's premium compared to local product.

EU to maintain restrictions on Brazilian beef :  21 July 2010

The EU is unlikely to change Brazilian beef import regulations, even after a recent visit by the Brazilian Minister of Agriculture to discuss the EU's stringent certification procedures, according to EU industry sources (Valor Econômico).

Since February 2008, Brazilian farms need to be individually audited by Brazilian Ministry of Agriculture (MAPA) technicians and later approved by the EU - this has decreased the number of approved properties from around 10,000, to only 100. Currently, this figure is close to 2,000 establishments.

The recent Minister's visit was intended to pass the approval responsibility to MAPA, but according to the EU Health and Consumer Commissioner, the ease in Brazilian product import controls faces strong pressure from EU producer organisations.

In addition, according to Brazilian producer associations, the number of certified establishments to the EU will increase proportionally as the EU certified steer price premium increases. The mark-up is currently only around 22-30A¢/kg, a level which does not encourage producers to join the system.

Full steam ahead

Although the highly-anticipated winter planting season across the state has turned out to be somewhat patchy, according to a report in Queensland Country Life primary industries continue to have a bright future.

The latest Queensland Rural Debt Survey released last week details how the financial sector has increased borrowings to Queensland agribusinesses by $3.24 billion - or 27 pc - over the past two years to a total of $15 billion.

The level of debt for the beef industry has increased by $2.19 billion (up 36 pc) during the past two years, which is said to be largely attributable to rising production costs and costs associated with drought.

The paper says that there also was debt incurred for infrastructure as some producers moved into beef from other industries. As a result, total rural debt for the beef industry has now reached $8.24 billion.

Red meat stars

Queensland's powerhouse $6 billion red meat industry will pause next month to salute its high achievers says Queensland Country Life when the 2010 Red Meat Innovation Awards are decided at the Royal Queensland Show.

Entries in the Rabobank Red Meat Innovation Awards officially opened last month and organisers have received a flood of nominations in the eight categories during the past five weeks.

The paper says the awards night has become a fixture on the industry calendar as it recognises the significant contributions of individuals and companies towards innovation in the red meat industry.

Awards will be presented at a gala dinner on the first night of the Brisbane Ekka (August 4) at the Meating Centre in the showgrounds, culminating in the Beef Industry Achiever of the Year award.

Feedlots ‘not needed yet'

While recent studies have highlighted the potential for four super feedlots along the Fitzroy River, Australian Lot Feeders Association president Jim Cudmore says the market is not yet ready for the up to 120,000 head of extra cattle they could supply says Queensland Country Life.

State government funded studies have identified nine areas along the Fitzroy which could be suitable for up to for up to four, 30,000-head feedlots, or up to nine 15,000-head feedlots.

The paper says that during the past 12 months the physical feedlot capacity in Queensland was about 630,000 head SCU but Cudmore says that the state operates on only between 50 and 60 pc of that figure.

Cudmore says the cost to develop a 30,000-head feedlot would be in the vicinity of $30-$36 million and says while market forces will eventually determine the need for the expansion at "this point in time we can't justify increasing".

Beef grilling to fan flames - again

Armidale has had its turn and last Friday it was the time for Rockhampton to experience the "exquisite" sensation of beef's long, cold winter of discontent says Queensland Country Life.

Back in February hundreds of beef producers descended on the tranquil New England city to vent their frustration at rising costs, falling prices and red meat consumption, abattoir closures  and the hot-button issue of imports from BSE countries.

Now it is five months down the track and beef producers have again come together, with the same beefs, this time at the Paradise Lagoons property of Queensland cattle baron Graeme Acton.

Acton says the rally provided a forum to launch a "new strategic plan" for the beef industry with proposals to lift prices, reduce costs, restructure and streamline the industry including a revamp of MLA and launch a rural development bank.

Feed system put through its paces

Keenan is pushing ration management to the next level with a new system that won't only improve the accuracy of what's going into the mixer - but what's coming out says The Land.

Its PACE (performance accelerated control enhancement) for beef system combines existing PACE capabilities for loading the mixer accurately and in the right order with capabilities to accurately measure how much is unloaded from the mixer in each pen.

The paper says two systems are currently being trialled on properties in Victoria and northern NSW ahead of a planned launch at the Commonwealth Bank AgQuip field days at Gunnedah next month.

Keenan physical nutritionist (beef specialist) James Bjorkstein says the system allows the operator to program how much feed they want to unload into each pen of a feedlot, ensuring feed provided is kept at its freshest.

Meat judging triumph

The prestigious Roy McDonald Shield has been returned to Australia for the first time in four years says The Land after our team defeated long-time rivals the US to take out the Intercollegiate Meat Judging (ICMJ) competition.

After consecutive years of success by Illinois, Oklahoma and Colorado universities, WA's Murdoch University produced amazing results to take out the contest over the University of Wyoming and other Australian and Japanese universities.

Murdoch coach Peter McGilchrist told the paper that the students on the team had prepared diligently for the competition and that he was "thrilled with the results" which included two team members making the Top 10 finalists.

They will travel to Brisbane later this year to complete an MSA training week. Charles Sturt University's Jessica Loughland was the star of the competition winning various beef and small stock classes as well as the sought-after Founders Buckle.

New England Angus sale leads the way

For the first time in 54 years of the New England Angus Breeders (NEAB) bull sale, to be held this year in conjunction with the Tamworth Charolais sale on July 22, the bulls will be unled says The Land.

NEAB sale president Ewen McLeish says that the decision was made because fewer people are breaking their cattle these days, so the organisers wanted to adopt a more commercial approach to the event.

But he told the paper that did not mean the quality of the offering would be any less than in previous years and that formal judging - with bulls in their pens - will still take place as usual on the day of the sale.

The first NEAB sale was conducted on the Manilla Road at Tamworth in 1956 and McLeish says it is still going as strong as ever. "Breeders are well positioned to capture a range of buyers from southeast Queensland, the Upper Hunter and Orange/Bathurst areas," he says.

Shedding light on weight gain

A report in The Land says how quickly cows shed their winter coats in spring may have an effect on their calves' weaning weights according to research led by Trent Smith, Mississippi State University, with funding from the American Angus Society showing a link between the two.

Smith says the objectives of his three-year study are to develop a method to measure hair shedding, determine the variation in hair shedding and then estimate sheddings effects on 200-day weights and body conditions scores.

He says the team observed 532 cows between 2007 and 2009 in North Carolina and Mississippi to determine if the perception is true that cows which do not shed, or shed later, are not good performers.

Data analysis revealed body score was not significant so researchers focused on weaning weights which revealed that cows which shed by May had, on average, 267-kilogram calves and after May averaged 265-kilogram calves.

Keeping Angus integrity high

The popularity of the Angus brand is growing daily and Certified Australian Angus Beef (CAAB) has taken its commitment to product integrity one step further with International Standards Organisation accreditation says The Land.

The paper says that the breed's ISO accreditation provides third party verification of programs carrying the Angus name - a step which consolidates the diversity of Angus products now on the market.

CAAB chief executive officer Phil Morley says the accreditation also indicates that the business has the management systems, procedures and integrity to provide verification in accordance with the ISO 9001:2001 world standard.

Apart from CAAB and Angus Pure, Morley says there are other processors anxious to benefit from the Angus brand so "we are now providing verification services" for Angus products ranging from five-star restaurants to fast food takeaways.

Alice shines

Centralian beef producers, basking in their best season for a decade, showed the quality of cattle the area is capable of producing at the recent Alice Springs Show annual blue-ribbon sale says Stock Journal.

The 3500-head yarding sold above southern prices - considering the huge freight bill - and the renewed optimism which comes from green herbage flowed into the show although bull-buying budgets were still tight.

The paper reports that although the region received a further 25 millimetres of rain during show week, it was still not definitely raining bids during the bull sale itself, despite the excellent lineup on offer.

This year was the first time in recent memory Angus bulls returns to the sale ring and they were well received with Landmark Alice Springs manager Ian Hayes saying the southern support was a big plus for the event.

Indo rejects hit prices

Cattle from Queensland formerly destined for live export to Indonesia are flowing into Victorian saleyards says the Weekly Times, pushing down prices for medium-weight and trade-weight steers and cows.

According to the paper, Meat and Livestock Australia says that a higher Australian dollar, and ongoing sluggish demand from key US buyers, is compounding that market change.

However, the Eastern Young Cattle Indicator, staged a mini recovery last week but was still below 350 cents, while prices for Japox, 500-600 kilograms, were led by improved prices in NSW.

MLA suggests that this improvement may indicate some interest from Japanese buyers, currently low on stocks and seeking supplies to meet improved demand, which is expected from next month.

Sober up - the party may be over

Prime stock prices may have peaked for this winter according to a report in the Weekly Times, with market trends in the past week suggesting the best money for young cattle and prime lambs has already been paid.

The paper says the beef market is now displaying signs of a mid-winter slowdown, with the Eastern Young Cattle Indicator below 350 cents a kilogram after holding at this level for about the past month.

"The usual suspects of subdued export demand from Asia and the US, combined with the bouncing Australian dollar, have been blamed for taking the shine off physical cattle prices," Jenny Kelly says.

"There has also been increased talk of ‘cheap boxed meat' from the north being put back on the domestic market, and in the past fortnight the paper has seen full eye-fillet steaks stamped with the AMH brand on special at Victorian supermarkets for just $14.99 a kilogram," she says.

Beef's domestic blitz

As if the beef news about the Indonesian export market is not bad enough, the nation's leading exporter has told Weekly Times northern cattle producers will be forced to flood Australia's domestic market with cattle no longer suitable for the Indonesian market.

Wellard Rural Exports managing director Steve Meerwald says Indonesia's decision to enforce its long-standing 350-kilogram limit reinforces the need to explore new markets. Wellard shipped 280,000 cattle to Indonesia last year.

In the past 12 months, Australia's nearest northern neighbour accounted for about 80 pc of all live cattle sold out of the country - or more than 700,000 head - but that figure is set to fall to 400,000-500,000.

"Our exports have slowed over the past six months while weight restrictions are dogging the trade," Meerwald says. But he believes markets including the Middle East, Philippines and Malaysia are possibilities.

Dollar does some serious damage to red meat

The Australian dollar traded 18 pc higher than the previous 12 months and it was the beef and veal industry which paid the price according to Stock and Land, with exports dropping seven pc to less than 900,000 tonnes.

Meat and Livestock Australia senior analyst Tim McRae says rain, or lack of it, also played its part, along with the tentative recovery of the global economy, particularly in our major markets of the US and Japan.

McRae says as a result Australian beef was costing more at a time when buyers in export markets, especially Japan, were looking to keep beef prices lower to maintain consumer demand.

Japan remains Australia's main export market, taking 349,888 tonnes shipped weight, which was four pc below the previous year, while the US contracted even further, dropping 25 pc to 210,514 tonnes - the lowest there since 1996-97.

MLA UPDATE

Rain boosts markets : 16 July 2010

Useful rains across NSW, Victoria, SA and WA over the past week has reduced yardings and lifted prices on young cattle, cows, ewes and restocker lambs. Store buyers have been more active on suitable stock.

Saleyard trade cattle values rose in Queensland, and to a lesser degree NSW, while cow prices lifted in NSW and WA. The national indicator price for Japan steers fell a further 9¢, to 319¢/kg cwt, led by declines in Queensland - a reflection of continuing weak Japanese demand and the rising A$.

Cattle prices often move towards a seasonal peak in August/September, as southern cattle turnoff declines as winter progresses. However, this could be muted this year if the A$ continues appreciating.

The rains and lower yardings did not prevent a further 2% fall in finished lamb prices, as a number of works remain closed for annual maintenance or on reduced shifts, the quality of old lambs is slipping and buyers anticipate a flush of new season lambs by August. Trade and heavy lamb prices are now on a par with last year's July rates, light and Merino lambs are 6-8% higher and restocker lambs are 23% higher than last year (reflecting the good season).

Mutton prices rose 18¢ this week, to 427¢/kg cwt. Prices are 38% up on last year, while numbers yarded are down 32%.

Winter weather continues :  16 July 2010

Rainfall was widespread over the last week, with good falls throughout southern and central Australia as a front swept through late in the week, dumping some of the heaviest July rainfall in years.

Particularly good falls were received in the previously parched WA wheat belt and in cropping areas in western NSW. Large swathes of WA, NSW, Victoria and Tasmania received over 50mm, but it was Mount Buffalo in Victoria that was wettest - at 230mm.

Friday daily livestock article  :  16 July 2010

At Roma, numbers increased by around a third in cheaper market. Yearling steers to slaughter were firm averaging 176¢/kg. A large supply of bullocks were 5¢ cheaper averaging 172¢/kg. Heavyweight D4 cows sold 1¢ lower and settled around 145¢ while heavyweights averaged 146¢/kg.

At Dubbo numbers slipped slightly with a greater percentage of plainer lines. Medium weight yearling steers to feed averaged 182¢, as the heavy feeder steers settled at 183¢/kg. Heavy yearling heifers to the trade sold from 165¢ to 190¢ to remain firm. Medium D3 cows gained 3¢, to mainly sell around 140¢, as the heavy lots settled at 152¢/kg.

Numbers contracted at Bairnsdale with better quality evident in some categories. Medium weight vealer heifers to the trade were 8¢ cheaper at 184¢ while heavyweight yearling steers were firm mostly selling around 187¢/kg. Heavyweight D3 cows were 3¢ dearer to average 155¢/kg.

After Thursday's markets the Eastern Young Cattle Indicator was 2.5¢ dearer than last week at 350.25¢/kg cwt. Trade steers gained 4¢ - to 192¢ and feeder steers were up 1¢ finishing at 189¢/kg. Japan ox lost 2¢ to 178¢ and US cow gained 3¢ to 135¢/kg.

Yardings were lower at Wagga after some mid-week rain. Young trade weight lambs topped at $130/head and averaged firm at 521¢, while the older pens averaged 525¢/kg cwt. Heavy lambs sold from $125 to $142/head and settled around 520¢/kg cwt. Medium weight Merino ewes were highly sought after, topping at $138/head to mainly sell around 510¢/kg cwt.

After Thursday's markets restocker lamb prices eased 35¢ in comparison to last week, down to 465¢/kg cwt. Merino lambs lost 15¢ to 438¢, as light lambs slipped 38¢ - to 434¢/kg cwt. Trade lamb prices were 11¢ cheaper, settling at 508¢ and heavy lambs averaged 496¢/kg cwt. Mutton finished 12¢ higher at 430¢/kg cwt.

Subdued Korean trading activity :  16 July 2010

Australian beef exporters reported slowing enquiries from Korean buyers this week. According to market sources, sufficient beef stocks, seasonally low beef consumption and the weakening won are all contributing to the subdued trading environment.

As a result, prices for imported beef cuts in the Korean wholesale market remained unchanged or were unquoted due to inactivity. The holiday season from mid July to mid August may also add to slowing the trade, as some Korean importers take a break.

Beef exports from Australia to Korea from 1-12 July this year were steady at 4,424 tonnes swt - chilled beef accounting for 24% (DAFF). While chilled beef's share of exports has declined, January to June volumes increased 29% on 2009.

DPJ faces political setback in Japan : 16 July 2010

The ruling Democratic Party of Japan (DPJ) experienced a substantial political setback last Sunday, with the largest opposition Liberal Democratic Party (LDP) and allied parties winning the majority in the Upper House election. The so called 'twisted Diet' (the opposition controls the Upper House while the ruling party remains in control of the Lower House) situation will likely put further pressure on the DPJ's political stability. In the meantime, negotiations on foreign trade policies may take a back seat to more pressing matters, such as a possible consumption tax increase and economic recovery measures.

In the Australian beef export market, Japanese businesses remained cautious this week, with the higher A$ causing a fall in the A$ export prices to Japan. Reports that the US market is gaining momentum prompted some Japanese buyers to lift bids on trimmings and some frozen products, but otherwise buying was still subdued.

About turn for US prices :  16 July 2010

After 11 weeks of decline, the imported beef market in the US turned around, as US domestic manufacturing beef supply has been falling over the past three weeks. Also, prolonged spot trading earlier in the year saw some US end-users going into the 4th of July holiday period with lower inventories.

Previously, it was indicated that the market is likely to have already seen its peak in imported prices. However, it appears imported beef supplies are falling short of current demand, particularly as US domestic supplies are tightening. The market may continue to rise into August, but seasonally, the imported manufacturing beef market tends to drop away come September, as grinding beef demand falls.

US protein prices forecast higher :  16 July 2010

Average US cattle and hog price forecasts for 2010 were revised down recently due to changes in forecast US beef and pork production, although prices are still expected to remain above year ago levels.

The recently released USDA World Agricultural Supply and Demand Estimates report, saw a slight upward revision in US beef production for 2010, due in part to higher cow slaughter so far this year and an increase in cattle placements into US feedlots over the past couple of months. However, US beef production for 2010 is expected to be 1% below 2009, at 11.69 million tonnes cwt (25.768 billion lbs).

Given tighter meat supplies, higher exports and some improvement in US meat demand, average US steer prices for 2010 are forecast to jump 12% on 2009.

The forecast for 2010 US pork production was also raised slightly, to 10.1 million tonnes cwt (22.269 billion lbs), although 3% below 2009. Higher slaughter and heavier carcase weights during the second quarter was the premise for USDA's revision. Despite recent increases in supply, US hog prices for 2010 are still predicted to jump 33%.

Contrary to beef and pork, 2010 US broiler production is predicted to increase 3% on 2009 volumes, as lower feed costs push bird weights and numbers up.

While it would be expected that higher production would translate to cheaper chicken, USDA is forecasting average US broiler prices to rise 8% in 2010. This is due to lower beef and pork production, and an expected boost in US poultry exports for the rest of the year, due to a resumption of exports to Russia.

Chilean beef imports up in 2009-10 : 15 July 2010

Chilean beef imports during 2009-10 increased 35% year-on-year to 133,822 tonnes swt. The rise was a result of the strong economic conditions, low domestic production and the higher imports from Paraguay, which jumped 36% to 79,503 tonnes swt.

Argentinean shipments to this market also increased a noticeable 36% to 39,419 tonnes swt during the period. However, most was imported during the second half of 2009 as production fell, with negligible recovery expectations during 2010.

Brazilian imports jumped 771% in 2009-10 to 10,859 tonnes swt as a result of increased access into the market. However, shipments from Brazil remain short of 2005-06's 24,593 tonnes swt.

Imports from Australia reached 1,715 tonnes swt (with the majority shipped during the second half of 2009) with an average CIF price of US$5,203 tonnes swt.

Butcher sales steady in 2009-10 : 15 July 2010

Butcher sales during 2009-10 were steady (beef and lamb) to higher (pork and chicken) compared with the previous year, according to MLA's butcher survey carried out by Millward Brown.

Of the 1,273 butchers interviewed in 2009-10, 53% reported 'very good to excellent' beef sales, steady compared with 52% in 2008-09. Sales of lamb were also stable on a year earlier, following 40% of respondents noting 'very good to excellent' returns. Lamb sales were particularly softer during the two months to June, as a number of butchers noted heavy lamb quality affecting sales.

Pork sales improved in 2009-10, as 34% of respondents indicated 'very good to excellent' sales compared with 30% the previous year. Around 47% of butchers also reported 'very good to excellent' sales of chicken during the 12 months to June, up from 43% reported in 2008-09.

Results from the butcher survey in 2009-10 also revealed a smaller proportion of butchers describing themselves as 'thriving' (16% compared with 23% in 2008-09). Meanwhile, more respondents noted their business as 'usually slow or struggling' (12% from 8% in the previous year). The percentage of butchers (69%) regarding themselves as 'doing OK' remained unchanged from a year earlier.

During 2009-10, the survey of butchers also indicated that prices of all meats averaged higher on a year ago.

Brazilian beef exports stable in 2009-10 :  5 July 2010

Brazil maintained its position as the world largest beef exporter during the past 12 months (July 2009 - June 2010) with exports increasing 0.3% on the previous year, to 958,034 tonnes swt.

Russia remained Brazil's main export destination during the period, despite shipments contracting 11% on the previous year, to 304,106 tonnes swt. Low prices in the Russian market, combined with constrained demand from local importers after the global financial crisis, encouraged Brazilian exporters to look towards other markets including the Middle East and South-East Asia.

Iran became Brazil's second largest market in 2009-10, with volumes jumping 97% year-on-year, to 159,175 tonnes swt, followed by Hong Kong (up 23%, to 98,900 tonnes swt) and Egypt (down 14%, to 67,510 tonnes swt).

While easily maintaining its position as Brazil most lucrative market (on a per tonne basis), exports to the European Union continue to remain well below the record volume shipped in 2005-06, at 290,908 tonnes swt. With restrictions in place since February 2008, triggered by traceability and food safety concerns, Brazilian beef exports to the EU in 2009-10 reached 47,082 tonnes swt, which was an increase of 76% on the very low 2008-09 total.

Average Brazilian beef exports prices (FOB) for the year increased 1%, to US$3,659/tonne year-on-year, as the Brazilian real appreciated 16%, to average 56US¢ in 2009-10. In local currency terms, average steer prices declined 8%.

The Brazilian Beef Exporters Association expects exports to increase in 2010, when compared to 2009, although remaining below the 1.023 million tonnes swt shipped in 2008 and the record 1,286 tonnes swt shipped in 2007.

Korea delays beef talks with Canada  :  15 July 2010

Bilateral talks between Korea and Canada to be held on 13 July this year to discuss the resumption of Canadian beef imports into Korea were unexpectedly delayed (Maeil Business Newspaper).

The Korean Ministry of Food, Agriculture, Forestry and Fisheries notified their Canadian counterpart of the delay as more time is needed to gather data in order to hold talks effectively. The Korean agricultural ministry plans to come up with a nationwide agreement, involving livestock and quarantine experts, producers and consumers before the talks take place.

Canada has not exported any beef products to Korea since bovine spongiform encephalopathy (BSE) was found in Canadian livestock in May 2003. However, the World Trade Organization for Animal Health has declared Canada "a controlled BSE risk" country since 2007.

Korea is currently reviewing its plan regarding Canadian beef imports after the Canadian government took the issue to the World Trade Organization for settlement of the dispute.

The Korean government is anticipating further discussions with Canadian officials in August this year.

May beef production declines : 15 July 2010

While Australian beef production increased year-on-year during May, it remained well below the five-year average, as producers continued to withhold stock after the better start to 2010. May is traditionally a high period for cattle throughput, as producers cull numbers in preparation for winter.

Driven by better seasonal conditions across eastern Australia, production reached 189,578 tonnes cwt for the month, 4% behind the five year average of 196,730 tonnes cwt.

Accordingly, production in Queensland was back 8% against the five year average in May, in line with lower slaughter levels, at 93,482 tonnes - just under half of total Australian processor output for the month. Production in NSW was back 1% to 40,099 and up 1% in Victoria to 31,768 tonnes, despite slaughter numbers in both states being well back against the five year average. The vastly improved season in Victoria and NSW has allowed much better conditioned cattle to hit the market, lifting the national carcass weight average to a new record of 272.8kg/head for Jan - May.

Production in SA rose 25% against the five year average to 9,412 tonnes, again boosted by a much better season, while numbers fell 9% in Tasmania (4,963 tonnes) and were steady in WA, up 1% to 9,771 tonnes.

Green Brazil  : 15 July 2010

The Brazilian Ministry of Agriculture has launched its Low Carbon Agriculture program (ABC), which will support sustainable farm practices, the recovery of degraded land and the integration of cropping, livestock production and forestry.

The program, which is budgeted at A$1.3 billion during the first 12 month period, is part of the Brazilian government's strategy to recover 15 million hectares of degraded pastures and achieve a 39% reduction in carbon equivalent gas emissions by 2020 (Scot Consultoria).

Global economic outlook upgraded - IMF :  15 July 2010

The International Monetary Fund (IMF) has upgraded the outlook for the global economy for the remainder of 2010, to 4.6%, assisted by a better than initially projected performance in the first half of the year, with upwards revision to output for the US and Japan. However, the main contributor to the higher growth expectations for 2010 has been from the emerging and developed economies, including China, India, Brazil and Russia.

After the sharp contraction in economic growth throughout the second half of 2008 and throughout 2009, the global economy appears to be on track to record a strong recovery in 2010, with this to be sustained for 2011. However, the IMF did state that significant risks still remain that could derail a recovery, including financial turbulence and debt issues throughout Europe.

Despite sustained high unemployment levels and ongoing financial jitters, the US economy is projected to expand at 3.3% for 2010, a substantial turn-around from -2.4% in 2009. For 2011, the US economy is expected to grow at 2.9%. After recording an economic contraction of -5.2% in 2009, the Japanese economy is projected to grow at 2.4% in 2010, and 1.8% in 2011.

The rapid expansion of emerging and developed economies continues to add strength to the global recovery, with China's growth forecast at 10.5% in 2010, followed closely by India (9.4%), South East Asia (6.4%) and Brazil (7.2%). Economic conditions in Russia are projected to go from of -7.9% in 2009, to growth of 4.3% in 2010.

According to the IMF, Australia's economic growth is forecast to reach 3% in 2010, increasing to 3.5% in 2011.

The financial collapse and recessionary period throughout 2008 and 2009 had a significant impact on beef demand, especially across advanced economies, including the US and Japan. However, the projection for better economic conditions in coming years should point towards a recovery in consumer demand, including for beef, which should be welcome news for Australia's export dependant red meat industry.

Middle East performs strongly in 2009-10 :  5 July 2010

Australian red meat exports to the Middle East region performed strongly during the 2009-10 financial year, with lamb volumes up 10% to 33,410 tonnes swt, beef up 40% to 19,423 tonnes, and mutton back only 5% to 46,202 tonnes.

Tight mutton supply in Australia caused a slight drop in exports to the Middle East, lamb increased as a result of continuing strong demand despite rising prices for sheepmeat, while beef benefited from increased demand for topsides, thick flank and knuckle.

The timing of Ramadan this year (August 11) and the resultant adjustment to school holidays have combined to create a 'mini' expatriate exodus. This has directly impacted on retail and hotel occupancy levels in the region resulting in a challenging trading month for June 2010. A more conservative approach by many importers with Ramadan ordering patterns has also impacted on the June import levels.

Volumes for June saw lamb down 12% on last year, mutton losing 45%, while beef continued its rise, growing by 57%.

The main mutton falls were in Saudi Arabia (down 76%; 2,298 tonnes to 559 tonnes) and the UAE (down 45%; 828 tonnes to 457 tonnes). Some interesting rises however were experienced in Bahrain (up 5,815%; 6 tonnes to 355 tonnes) and Egypt (up 176%; 146 tonnes to 404 tonnes).

Conditions considered, lamb held up relatively well with Saudi Arabia increasing 46% (215 tonnes to 313 tonnes) and Jordan increased by 7% (822 tonnes to 876 tonnes). With temperatures in Kuwait often in the 50 degrees plus region, it is an example of seasonal influence with a fall of 34% (394 tonnes to 259 tonnes) and the UAE fell 25% (1,343 tonnes to 1,013 tonnes).

Beef benefited from increases to Egypt (up 346%; 130 tonnes to 578 tonnes); the UAE (up 69%; 308 tonnes to 523 tonnes); Jordan (up 121%; 73 tonnes to 161 tonnes) and Bahrain up by 1,066% from 5 tonnes to 53 tonnes.

Volatile year for beef

A fluctuating dollar, erratic export demand and unexpected seasonal conditions all led to an unpredictable financial year for beef cattle producers according to a report in the Weekly Times.

The paper says that in the financial year just ended, national beef cattle prices slipped 2.5 pc on average, but at the same time producers sent more cattle to market.

Meat and Livestock Australia economist Tim McRae says the past 12 months have been characterised by a volatile Australian dollar and sluggish export demand - with returns from our two major markets both dropping, as did returns in Australian terms due to the dollar.

Total export volumes of boxed beef and veal were back seven per cent to 898,960 tonnes he says while exports to the US dropped 25 pc to 210,500 tonnes and shipments to Japan were down four pc.

Another case of FMD in Japan

A new case of foot and mouth disease (FMD) was discovered in Japan last week according to a report in the Weekly Times, extending the unprecedented FMD outbreak in Japan's Miyazaki region.

The paper says that according to World Organisation of Animal Health data, the outbreak, which began in April, has so far resulted in 188,753 animals - 153,676 pigs and 35,019 cattle - being destroyed.

Since the first reported outbreak there have been 290 outbreaks of FMD recorded with WOAH but movement restrictions in the infected areas were gradually being removed. However, following the new infection it is clear the outbreak is not over.

The self-imposed export ban on all beef is still in place, except to Hong Kong and Macau, and according to MLA, weak market conditions in Japan held Australian beef and veal exports for June back 14 pc year-on-year, to 27,691 tonnes shipped weight.

Top grade

The Meat Standards Australia (MSA) grading program continues to grow at an exponential rate judging by its recently released end-of-year figures according to a report in the Queensland Country Life.

Those figures show that MSA cattle numbers graded across Australia reached just over 1.25 million head for the 12 months ended June 30 - which is a spectacular 28 pc rise on the previous financial year.

MSA beef grading numbers passed the one million head for the first time in a 12-month period to December 31 and since then activation of MSA programs in a number of abattoirs, and expansion of programs in existing MSA-licensed plants, has further boosted numbers.

Despite the high throughput, the rate of compliance in cattle against MSA specifications has continued to creep higher, rising to 91.7 pc nationally for the June 30 year - up almost one pc on the previous financial year.

Science gives boost to beef market access

CSIRO has conducted research into the prevalence of non-O157 E. coli strains in Australian beef according to Queensland Country Life - the very same varieties that are gaining adverse attention in US and European markets.

Results suggest the presence of these strains in Australian beef cattle is very low, reinforcing previous findings that support our position as a source of quality, clean, green meat products.

Dr Kari Gobius, food safety research leader at CSIRO, says that the research is important for safeguarding the health of consumers and reducing the socio-economic costs associated with medical treatment.

Gobius says the research - which focused on methods for detecting and isolating bacterial strains related to, but different from, the more common E. coli O157 - also ensures the Australian beef sector can readily adapt to changing regulations, maintaining access for our $7 billion export industry

Biloela trial reveals NLIS value

Central Queensland beef cattle producers are invited to a July 15 Biloela district field day to see firsthand how NLIS technology can be used to improve herd management and business profitability says Queensland Country Life.

Department of Employment, Economic Development and Innovation (DEEDI) FutureBeef industry development officer Lindy Symes says the on-property NLIS day will finalise a three-year producer demonstration site trial.

Project co-ordinator Gavin and Megan Muller will host the event from 9.30 am to 3 pm at their Callide Valley property Gavyna where the NLIS project has used weaners sourced from the Muller's co-owned Ubobo breeding property Cooinda.

The MLA funded trial, an initiative of the eight family businesses within the CQ BEEF Biloela group, is aiming to demonstrate how the collection of NLIS data could help solve livestock management problems. Details from 07 4992 9178.

Fertility under the microscope

It has only been in recent years that the bovine semen morphology assessment has literally come under the microscope as a further check on a bull's fertility according to a report in the Queensland Country Life.

To maximise production potential astute beef producers have been applying bull soundness evaluation examinations before seasonal paddock mating as well as those used in AI programs to fast-track superior genetics.

Department of Employment, Economic Development and Innovation (DEEDI) FutureBeef extension officer Ken Murphy says the issue of cattle semen quality assurance has been raised at CQ BEEF Moura and Bajool producer group meetings.

Murphy says the interest in semen assessment with a focus on morphology was expressed by seedstock breeders and commercial operators. An assessment of semen for morphology or shape of the sperm identifies whether an individual sperm is normal, or abnormal, in shape.

Taste for Angus beef on a roll

It appears the taste for Angus beef is extending far beyond out supermarkets and burger chains according to a report in the Queensland Country Life.

Angus Australia chief executive Peter Parnell, has told the paper that breeders in Queensland - and elsewhere in the country - are receiving more inquiries from beef producers keen to introduce Angus genetics into their herds.

In an article featured in the paper's crossbreeding special report Fusion 2010, Parnell says increased recognition of the Angus brand as a "premium" product is now having an impact in the paddock as well as on the plate.

He says there is "no doubt we are seeing an upsurge" of interest in Angus genetics among beef producers in northern Australia, based on Angus' proven ability to enhance meat quality and improve compliance to MSA grading.

Casserole on the menu

Meat and Livestock Australia's latest marketing campaign is seeking to put beef casseroles back on the family dinner table this winter according to a report in The Land, with new recipes and advice on cut selection and cooking.

MLA marketing general manager David Thomason told the paper that the previous two campaigns were successful in increasing the volume of beef casserole cuts purchased.

Thomason says that in winter last year, beef servings over the campaign period averaged 52.67 million a week, which was 6.81 million per week higher than the same period in the previous year according to Roy Morgan data.

He says MLA is aiming to not only build householder confidence to cook a greater range of beef dishes, such as casseroles and roasts, but to drive further beef purchasing by enticing consumers to expand their repertoires to include meals such as goulash, curries and beef bourguignon.

Coles launches state-of-origin campaign

Coles supermarkets has launched its "100 pc Qld Beef" logo, which a report in the Stock and Land says will be shown on packs of beef containing locally bred  and raised product sold within the State.

The paper says that the initiative will draw on information from the National Livestock Identification Scheme (NLIS) which will allow the retailer to accurately trace the origin of its beef products.

The culmination of a long-held desire to develop a hole proof system with Australian Country Choice and Colesstock, the logo has provided further proof of Coles support for Australian producers says its meat general manager Allister Watson.

Watson says the program has also been introduced in a direct response to consumer feedback which revealed the chain's customers wanted to know where their products were coming from.

Cattle Council yearbook

Cattle Council of Australia's 2010 yearbook is now available to beef producers and those interested in learning about national "hot topics" affecting Australian beef cattle producers according to Stock and Land.

The paper says that the yearbook covers market access progress, environmental policy, emergency animal disease response plans, beef-focused research, development and extension initiatives and market statistics.

The yearbook also contains summaries of beef farming issues at the State and national level, as well as insights into peak industry groups such as State farming organisations.

Copies of the yearbook are free from the Cattle Council of Australia office by contacting 02 6273 3688 or e-mail cca@cattlecouncil.com.au.

Beef processors adjust for export

With the Indonesian government imposing its 350-kilogram restriction on live cattle imports, Stock and Land says the entire Australian cattle market is currently challenged by, and reorganising for, a fundamental shift in buying demand.

And adjusting to this change has meant a larger number of cows, heavier steers and bulls that would have been exported live are now seeking slaughter at home rather than abroad, suppressing the usual mid-winter price spike by congesting kill space at some export plants.

Ruralco NT specialist Peter Watkins  says if anyone remains unconvinced the northern live export industry does not have an influence on southern cattle prices, now is the time to take notice.

Watkins says in the past the northern live export has virtually been an "open slather" affair, taking all weights and grades of cattle but by enforcing its longstanding 350-kilogram limit it means suppliers of rejected northern cattle are now looking for markets elsewhere.

MLA UPDATE

Volatile A$ continues - 09 July 2010

The A$ continued to be volatile this week, moving as much as 2¢ (or 3%) against the US$ during one day's trade, to finish Thursday at 87US¢ (Reserve Bank of Australia)

The A$, which moved over a range of 3.5¢, or 4% for the week, initially surged on improved confidence from overseas investors, which lifted markets in general. This was added to by the release of strong jobs growth by the ABS on Thursday, which raised the likelihood of further interest rate increases in coming months.

The A$ is now 3% lower against the US$ than at the beginning of the year, 7% lower against the yen at 77¥, and 2% higher against the Korean won at 1056won.

Korean beef trading activity eases - 09 July 2010

Similar to last week, Australian beef exporters reported steady to easing demand from Korean importers. Subdued Korean beef consumption during summer, and solid beef stocks as a result of increasing beef imports this year may have affected trading activity.

Subsequently, prices for the majority of imported beef cuts decreased in the Korean wholesale market this week. The most significant drop in value was for imported short ribs, after registering price hikes from the start of this year until early June.

Currency volatility is currently gripping both Australian beef exporters and Korean importers. Reportedly, the Korean won was at a two week high on 8 July - responding to news that US retail sales rose from January to June this year. The A$ also jumped on the same day, to a weekly high of over 87US¢, as employment figures came in much higher than expected (Bloomberg).

Cattle market wrap - 09 July 2010

Financial year cattle slaughter down

Eastern states cattle slaughter numbers for the 2009-10 financial year contracted 6%, to just over 6.1 million head. Calf slaughter fell 7% compared with the previous year, with 542,909 head processed nationally.

The majority of the fall in slaughter was in Victoria, down 22%. This was largely due to the high turn off of cattle in the previous year, associated with the liquidation of the dairy herd. The number of cattle to slaughter in NSW and Queensland was also reduced, falling by 3% and 4%, respectively, with a wet January and February restricting shifts for some northern processors as sufficient cattle could not be sourced. These falls were partially offset by a rise in SA, where cattle slaughter increased by 11%.

Compared with June 2009, slaughter in most states increased, with eastern states slaughter up 10%. NSW remained relatively steady - with 181,552 head processed. Queensland kills increased 13%, with many processors having a good supply of cattle coming out of the northern, central and western districts. Victorian slaughter increased 5% and SA numbers more than doubled compared with June 2009.

SA cattle supply drops

SA cattle throughput fell 18% compared with last week. No sale at Millicent was a factor, but lower yardings at Naracoorte and the SA Livestock Exchange also contributed - falling by 36% and 41%, respectively.

The reduction in numbers had a mixed effect on prices. Yearling steers to the trade recorded gains of 3¢ to 5¢ as medium weights averaged 178¢, and heavyweights sold to a top of 195¢ and averaged 180¢/kg lwt. Despite spirited bidding from lot feeder buyers at the SA Livestock Exchange, feeder rates could not be maintained, resulting in medium yearling steers slipping 4¢ to average 186¢/kg lwt. Yearling heifers followed a similar trend, with C3 medium and heavyweights to slaughter improving up to 12¢/kg lwt.

Heavyweight C3 grown steers improved 1¢, to average 178¢, while heavy D3 cows averaged 3¢ cheaper to mostly sell around the 138¢/kg lwt mark.

Grown steer supply improves

This week, the supply of grown steers increased 16% across MLA's NLRS reported markets compared with last week. The lift in supply did little to dampen prices, with strong competition from processors helping to maintain or improve last week's rates.

Most of the increase was a result of grown steer throughput improving 45% in NSW. Most of the grown steers were yarded at Dubbo, CTLX and Wagga. An excellent pen of 12 B3 steers estimated to weigh 560kg lwt topped the state reaching 199.6¢/kg lwt. The large increase in numbers at the Roma store sale resulted in grown steer offerings in Queensland increasing 11%, with Victoria experiencing a similar lift.

The majority of the increase was in the medium and heavyweight categories. The improvement in quality outweighed greater supply, with better quality pens attracting demand and making higher average prices. Nationally, heavyweight C3 pens averaged at 172¢/kg lwt up 2¢.

Alice Springs store sale - 09 July 2010

The annual Alice Springs Show store sale was held in light steady rain and muddy conditions, which was quite different to the normal. A mixed quality yarding of 3,051 steers and 527 heifers sold to solid competition from the 22 registered buyers.

The cattle were in generally good condition, due to the rainfall that most districts around the "Alice" registered earlier in the year.

The British C2 vealer steers sold from 165¢ to 180¢, and Santa Gertrudis drafts averaged 160¢/kg lwt.

Yearling Shorthorn steers sold from 160¢ to 189¢/kg, with the EU lines at the higher end of prices.

Yearling heifers in small runs sold at 150¢ for the Droughtmasters, 149¢ for the Santa Gertrudis and 152¢/kg lwt for the Charolais crosses.

Markets slide as numbers increase -09 July 2010

Cattle and lamb markets came under downward pressure this week, as numbers and the A$ rose.

The main price falls were for finished lambs, which are still in good supply due to the favourable pasture and grain feeding situation. Lambs yarded at MLA's NLRS reported sales rose 17% this week, led by NSW and WA, to be 10% up on the same time last year. The peak prices for this winter appear to have been in June, as markets are now impacted by seasonal export works closures and shift cutbacks. Also, the NSW sucker turnoff is expected to be early this year (by August).

National average mutton sheep prices defied a 20% jump in yardings and the higher A$ to rise 7¢, to 407¢/kg cwt, led by NSW.

After staying within a cent of 350¢/kg cwt for the past month, the EYCI broke away this week, dropping to 347.75¢. This was influenced by rising cattle numbers from Queensland and NSW, the sluggish US market and higher A$. Prices for cows, medium steers and trade cattle followed suit.

One exception was Japan steers, with the national price indicator up 9¢, to 328¢/kg cwt, due principally to an 18¢ rise in NSW, despite a 45% jump in grown steer sales in that state. This probably indicates some pick up in Japan interest in anticipation of the end of the summer rains and improved beef demand from August.

Unseasonable northern rain - 09 July 2010

Despite scattered rain throughout the eastern states, the heaviest falls this week were across northern Australia - very unseasonable for this time of year. Parts of the Barkly district had heavy falls, while in the Alice Springs Region, Yuendumu received 127mm - weather more suited to the wet season. Further rain is expected over much of WA in coming days, while a vigorous cold front is forecast for south-east Australia early next week.

Slow demand in Japan - 09 July 2010

There was a lack of active interest from Japan for Australian beef most of this week, despite some stocks in the market reportedly getting low. Buyers were cautious across the board, with the exception of inquiries for trimmings and briskets.

The higher A$ this week and restrained demand resulted in softer export prices to Japan, reducing returns to Australian exporters.

In the Japanese livestock market, Chikusan Nippo reported that adult cattle slaughter numbers in June contracted 8.4% year-on-year. The fall was largely due to the foot-and-mouth outbreak in Miyazaki (the third largest prefecture for beef cattle in Japan), and subdued prices in the Japanese wholesale carcase market. The fall in supply, however, seemed to have had little affect on wholesale or retail prices for Japanese domestic beef, as meat demand overall remained slow during June.

Imported beef not feeling the US heat - 09 July 2010

As temperatures in the US soared over the Independence Day holiday weekend and into this week, imported beef prices and demand reportedly cooled.

Areas on the US east coast saw temperatures swelter up to 43 degrees Celsius this week, which counteracted an expected boost in consumers 'grilling' a large proportion of meat items such as hamburgers and rib eye steaks. Instead, consumers reportedly opted for lighter meals at the detriment of beef and lamb.

The imported beef market in the US traded lower this week, despite lighter volumes reportedly traded. The CIF indicator price for imported 90CL shed 1.5¢ on last week, to 147.5US¢/lb CIF, while in A$ terms the indicator dropped 18.2¢, to 341.6A¢/kg FAS.

Imported beef supplies still remain lower than year ago levels from Australia, New Zealand and Uruguay. However, over the past two months, Australian beef volumes to the US have lifted amid an increase in Australian beef production during May. Recently released figures for Australian beef exports to the US show June volumes jumping 12% on the same time last year, to 24,434 tonnes swt, largely due to an increase in manufacturing and middle cut exports.

China lifts ban on imports of Canadian beef  - 08 July 2010

China has agreed to resume beef imports from Canada, seven years after banning the trade as a result of bovine spongiform encephalopathy (BSE) concerns.
According to a statement jointly made by China's General Administration of Quality Supervision, Inspection and Quarantine and Ministry of Agriculture on 2 July, beef imports from Canada will resume in stages, starting with boneless beef from animals under 30 months of age and beef tallow for industrial use.

According to Global Trade Atlas, China imported 221 tonnes of frozen boneless beef from Canada in 2002 - 2% the total China beef import market - before being barred in May 2003.

Brasil Foods hit by antitrust recommendations - 08 July 2010

Brasil Foods S.A., the company resulting from the prospective merger of Brazilian food processors Perdigão and Sadia, has been hit by the recommendations given by the Brazilian Ministry of Finance (SEAE) prior to approval by Brazil's antitrust agency, CADE.

Perdigão and Sadia have long been two of Brazil's major poultry processors, with increasing market share and diversification in dairy, pork, beef, and other processed products. These companies enjoy strong brands in emerging export markets for chicken and ready-meals. Overall, 42% of Brasil Foods S.A. is from exports (Beefpoint).

The recommendations for approving the merger include the possibility of brand leasing, or selling some assets. According to the SEAE, the company may have excessive concentration in some markets, which may complicate the entry of new competitors. Investors have perceived these recommendations as largely detrimental to the success of the company, impacting share prices.

Record beef exports to South Asia in 2009-10

Australian beef exports to South East Asia and Greater China jumped 20% in 2009-10 on the previous year to 131,216 tonnes swt, despite the high A$ and subdued supply towards the end of 2009-10 curbing shipments from Australia.

Interestingly, demand for quality beef in South East Asia and Greater China seemed unaffected by the global financial crisis, with both chilled shipments and grainfed beef exports in 2009-10 reaching new records (13,978 tonnes swt and 9,463 tonnes swt, respectively).

Assisted by strong demand and available supply over the first half of 2009-10, exports to most markets in the region also reached new records (China, Hong Kong, Indonesia and Malaysia) and seven year highs (Taiwan and Philippines), except for slight decreases in shipments to Singapore and Vietnam.

Driving the increase in exports to the region 2009-10 was record shipments of most popular beef cuts, including manufacturing beef (37% of the total shipments), shin shank (17%), blade (8%), knuckle (7%), neck (6%), silverside (4%) and striploin (3%). Intercostal shipments bounced to a six year high (3% of the total exports), resulting from increased demand from Taiwan.

Despite the record shipments to South East Asia and Greater China, total exports to the region over the latter half of 2009-10 were steady. The stable trade resulted from a combination of decreased enquiries for Australian beef (Indonesia, Singapore and China) and increased shipments following improved economic (Philippines) and market access (Malaysia) conditions.

Beef offal prices flat in June - 07 July 2010

Beef offal prices were flat in June, with weaker prices for higher yielding offal reportedly dragging overall prices down (MLA's Monthly Co-products Monitor). The lower A$ gave some support to prices - averaging 85US¢ over the month, 7% less than the beginning of the year - but not enough to prevent overall returns slipping (Infoscan).

Korean and Japanese offal prices tended to be weaker over the month, despite much larger volumes of beef offal reaching each market. Offal exports to Korea in June rose 53% year-on-year to 2,067 tonnes swt, with large increases in both tail and tripe shipments, while exports rose 6% to 2,573 tonnes in Japan. Swiss-cut tongues averaged $10.30/kg, 22% less year-on-year, while rumen pillars (500-700gms) fell 2% to $5.81/kg. Tendons averaged 24% lower at $4.22/kg, while thickskirt ($3.94/kg) and thin skirt prices ($4.04) were flat.

Halal offal prices were almost all weaker following the wider market down, with lips the only exception at $2.39/kg. Halal hearts ($1.47), kidneys ($0.95), liver ($1.18) and tripe ($2.23) were all weaker, falling 21%, 20%, 5% and 4%, respectively, over the month. Halal prices should find support in coming months, as Ramadam approaches in August, and importers seek to build stocks.

Liver and heart prices reportedly suffered from weaker demand in Russia, where offal exports fell 8% to 592 tonnes swt. Livers averaged $1.13/kg in June, 3% higher year-on-year, while kidneys fell 16% to $0.81/kg. Heart prices also declined in June, averaging 17% less than a year earlier at $1.31/kg. Tripe prices averaged $1.99/kg, 10% less than a year earlier, with congestion and hold-ups in a number of overseas ports such as Hong Kong reportedly affecting prices.

Korea not renegotiating FTA with US - 07 July 2010

US President Barack Obama's remarks on 26 June on restarting discussions on the yet to be ratified Free Trade Agreement (FTA) with Korea were quickly rebuffed by Korean trade minster Kim Jong Hoon who indicated that no revisions will be made (Yonhap).

The US President announced he would have his administration engage with their Korean counterparts in order to have a revised trade agreement ready for the next G20 summit in November this year (AFP). It was the first time the US has provided a timeline on the Korea-US FTA, which was signed under the Bush administration in June 2007, but not progressed due to US concerns over access to the Korean market for American beef and automobiles.

Korean trade minster Kim Jong Hoon responded to Obama's comments by explaining that any further consultations regarding the FTA would only be held on a "working level", as both countries have previously agreed on everything else (Foodmarket).

The largest trade union in the US (the American Federation of Labor and Congress of Industrial Organizations) also expressed opposition to the ratification of the current agreement. The union is seeking improved access to the Korean market for US automobiles and beef - the latter being restricted by Korea only importing US beef from cattle under 30 months old due to fear of mad cow disease (Foodmarket).

Rising sterling ends UK meat industry summer - 07 July 2010

UK exporters are adjusting to difficult trading conditions, as the pound sterling strengthens against the euro after depreciating in 2008 (the result of the financial crisis).

In 2009, British packers faced favourable conditions, with increased export shipments into the euro zone as a result of the positive currency trading conditions (as well as higher prices of imported meat in pound sterling terms into the UK, increasing the competitiveness of local product in the domestic market). In addition, imports to the euro zone from South America, New Zealand and Australia have been not been largely benefited as these countries' currencies also regain value.

Local producers also benefited by the sterling's lower values, as farmgate prices rose due to increased export demand and increased payments to producers (set in euros in the Common Agricultural Policy) in sterling terms, temporarily ending the decline in the breeding herd. However, cow slaughter has increased 10% during the first five months of 2010 year-on-year, weakening prices.

Beef exports to Japan fall in June - 07 July 2010

Australia exported 27,691 tonnes swt of beef to Japan in June, down 14% year-on-year (Department of Agriculture, Fisheries and Forestry). Slow in-market demand during May resulted in cautious buying by Japanese importers in June.

In May, average purchase volumes of Australian beef at retail in Japan were only 84% of the previous year's volumes (point of sale data, Agriculture and Livestock Industry Corporation of Japan). The foodservice sector also lacked spark during the month, with consumers spending modestly when eating out, as they are still concerned about the country's economic recovery.

Subsequently, Australian beef exports to Japan in June declined year-on-year for most categories, in particular for grassfed beef - both chilled and frozen exports were down 26% to 3,756 tonnes and 20% to 11,791 tonnes, respectively. Total beef exports to Japan between January to June were 4% below the same period last year, at 172,032 tonnes.

Tough 2009-10 for Aussie beef exports - 07 July 2010

Australian beef and veal exports for the past fiscal year (July 2009 - June 2010) contracted 7%, due to lower beef production, the high A$, increased US competition and sluggish export demand - as major markets slowly recovered from deep recessions. Exports for the year totalled 898,960 tonnes swt, with falls to Australia's two largest markets, Japan and the US (Department of Agriculture, Fisheries and Forestry - DAFF).

One of the main overriding factors for the past 12 months for Australian beef exports was the slow and tentative recovery of the global economy after the deep recession. As the fallout from the recession extended globally, it was the impact on US and Japanese consumer demand for beef which hit Australian exporters, accentuated by a much higher A$.

The A$ in 2009-10 averaged 18% higher than the previous year, at 88.2US¢, which added to the cost of Australian beef at a time when buyers in exports markets, especially Japan, were looking to keep prices lower to maintain consumer demand. Against the Japanese yen, the A$ averaged 9% higher, at 80.6¥, while it jumped 17% against the euro, 10% on the Korean won and 7% against the Indonesian rupiah.

Demonstrating the impact of the higher A$ on export beef returns, indicative Australian 90CL manufacturing beef returns from the US market averaged 6% higher in US¢/lb terms in 2009-10, but when converted to A$, they averaged 11% lower. However, while averaging lower for the year, prices in the US did improve throughout the year, peaking in April, as market signals pointed to recovering demand in 2010 and low beef inventories.

Japan maintained its position as Australia's largest market in 2009-10, despite exports contracting 4%, to 349,888 tonnes swt. Combined with tighter available beef supplies, Australian beef to Japan faced increased competition from US imports (tracking 47% higher as at the end of May).

The fall for the year was primarily due to lower grassfed beef shipments, which were down year-on-year for eight consecutive months between July 2009 and February 2010, as suitable supplies of heavy finished steers remained tight. Total grassfed Australian beef exports to Japan for 2009-10 were back 6%, at 198,691 tonnes swt, while grainfed shipments were up slightly, at 151,197 tonnes swt - assisted by increased numbers of cattle on feed.

Australia's beef and veal exports to the US for the past fiscal year dropped 25% to 210,514 tonnes swt - the lowest fiscal year volume since 1996-97. This was due to tight manufacturing beef supplies, the high A$, more attractive prices elsewhere, high US cow beef supplies and sluggish US consumer demand, with recessionary conditions and very competitive prices for chicken and pigmeat.

One of the brightest markets for Australian beef in 2009-10 was Korea, with exports up 10% year-on-year, to 123,837 tonnes swt. Australian shipments had been expected to contract under increased pressure from US imports. However, robust Korean demand and a decline in domestic beef production lifted demand for Australian beef, especially chilled product.

Demonstrating the rapidly growing importance of the South East Asian region for Australian beef exports, shipments in 2009-10 were a record 131,302 tonnes swt - up 20% on the previous year and 85% above the average for the past five years. The most notable growth was to Indonesia, where exports surged 31% year-on-year, to a record 49,769 tonnes swt.

Record volumes for the period were also registered to China (up 6%, to 4,323 tonnes swt) and Hong Kong (up 56%, to 8,185 tonnes swt), while exports to Taiwan reached their highest level in seven years, at 31,758 tonnes swt.

Despite a resurgence since March, Australian beef and veal exports to Russia for 2009-10 slipped 36% year-on-year, to 23,769 tonnes swt, reflecting weak demand and tighter supplies throughout late 2009 and early 2010.

The Middle East continued to expand for Australian beef in 2009-10, with beef demand boosted by rising demand and tight supplies for other protein products. Exports for the year surged 40%, to a record 19,397 tonnes swt - with Dubai and Saudi Arabia the largest single markets.

For 2010-11, Australian beef exports are expected to benefit from slowly recovering demand, based upon the assumption of further improvement in economic conditions in the US and Japan. The A$ is likely to remain a major constraint again for exporters, while available beef supplies should improve into 2011.

Ramsay swears by beef

When you are dealing with the world's most notoriously acting chef, then your product had better be up to scratch according to a report in the Weekly Times.

That was the case for Hopkins River Beef, which as part of the Put Victoria On Your Table month, supplied Ramsay's new Melbourne restaurant, Maze, with 30 kilograms of grainfed striploin, served at the weekend.

The paper says that the Maze head chef Josh Emmett was first attracted to Hopkins River Beef, not only for its reputation of quality and consistency, but also because of its environmental credentials.

"Victorian producers work long and hard to create their produce, and it is great that restaurants are recognising this and supporting them," Hopkins River Beef's Adam North says. "Anything Gordon Ramsay endorses will generally take off and it is a real compliment we are producing beef that quality restaurants such as Maze are using."

Meat bosses get the chop

Allan Bloxsom, the man behind such pioneering projects as the National Livestock Identification System (NLIS) and Meat Standards Australia (MSA) - which now grades more than 1.2 million cattle a year - has been given the chop from Meat and Livestock Australia (MLA) says Weekly Times.

Following him out the door is MLA marketing general manager for the past 12 years David Thomason, who was responsible for the hugely successful lamb marketing program using Sam Kekovich for its Australia Day campaigns.

Bloxsom was formerly the manager of the now defunct Hereford Prime program who joined MLA in 1999 as its regional manager based in Japan, before taking up the industry systems role in 2002.

MLA managing director David Palmer announced the retrenchments and replacements last week, with Glen Feist taking over from Thomason and Michelle Gorman from Bloxsom. Palmer says the changes are about "reinvesting in the future".

VFF has a cattle beef

According to a report in the Weekly Times, falling subscriptions are costing Victoria's beef cattle producers a voice on their industry's national peak body - the Cattle Council of Australia.

Victorian Farmers Federation (VFF) livestock president Chris Nixon last week confirmed that the VFF is no longer a member of Cattle Council following a dispute to erase a debt reported to be an affiliation payment of $20,000 to the council.

Nixon told the paper that he was hopeful the protracted dispute could be settled in the near future and the Victorians get back onto the cattle industry's national agenda. Despite the debt Cattle Council is allowing VFF's Michael McCormick to attend council meetings.

Nixon says he is blaming the VFF's tight financial situation for the predicament. He is querying why fewer producers are having to pay for national representation. "We are capitalising the costs but socialising the benefits," Nixon says.

Being used and abused by US

Federal Opposition agriculture spokesman John Cobb has told the Victorian Farmers Federation annual conference in Bendigo that the US is using Australia as a back door into the lucrative Japanese and South Korean beef markets says Weekly Times.

The paper says that Cobb told the conference delegates that the Americans believe if they can get product from a BSE-affected country through Australia's quarantine screen, it will prove to the Asian market that it is safe.

He says the US "can't seriously want to export their beef here" and that "Australia is the last market they would be chasing". But he says everyone knows when it comes to quarantine "we are as tough as it gets".

Cobb says the US and Brazil, the world's two biggest beef producers, are "not within coo-ee of either our quarantine laws of the National Livestock Identification System" and that is the blanket they want to throw over their own products.

Healthy fat claims in store for beef packs

A team of UK scientists is confident that it can deliver meat containing enough healthy fat to make "source of omega-3" nutrition claims on the pack according to a report in Stock and Land.

The paper says that the scientists believe by manipulating the diets of beef cattle, the fatty acid of their carcases can be improved to meet the required standards.

The research is part of a five-year (finishing in 2012) government-backed ProBeef project, which is being co-ordinated by the Institute of Grassland and Environmental Research (IGER) at Aberystwyth in Wales.

The project is running in parallel to a larger, EU-funded ProSafeBeef project looking at microbiological and chemical contaminants in beef and beef products and innovations in beef processing and products.

Primex powering ahead

The Primex Primary Industry Exhibition will continue to go from strength to strength according to Queensland Country Life with plans to expand the sustainability awards and create an annual beef industry trade show.

Primex director Bruce Wright says the number of entries into the Primex sustainability awards doubled to 50 this year and the number of cattle breeds on show more than tripled with string crowds throughout the three days at Casino.

Wright told the paper that with the solid and reliable rains throughout the region earlier this year, there was now a positive mindset amongst landowners, which was also being reflected at the exhibition.

And while more than 1000 companies were represented at the event's trade stalls, it was the increased participation of cattle breeders and sustainable businesses that Wright highlighted as the new successes for the field event.

Glenprairie sale presses ahead

Queensland cattle baron Sir Graham McCamley will press ahead with the sale of his $80-$90 million Glenprairie Station in Central Queensland after the tragic death in April of his wife Shirley put the offering in doubt says Queensland Country Life.

McCamley told the paper that the tributes to his wife had been overwhelming and that he would honour the promise he made to her to sell the property and start to wind back his cattle interests.

"I probably need to step back a bit now," says McCamley, who wealth is estimated at $232 million by BRW magazine, built on his diversified grazing, farming and irrigation property portfolio covering more than 100,000 hectares.

"I promised Shirley I would sell it and that's what I'll end up doing but I know I will keep really busy with Tartrus (another of his cattle stations)," he says. The 46,500-hectare Glenprairie, just outside Rockhampton, is one of the largest organic cattle operations in Australia.

Thangool leucaena lets rip

The jury is still out on whether a capital outlay of around $300 per hectare to establish leucaena on shallow forest country soil will be a long-term winner says Queensland Country Life but initial plantings have buoyed Stuart Barrett's enthusiasm for further investment.

A Thangool district beef producer, Barrett hosted a recent field day to review a producer demonstration site trial, which has been co-funded by MLA and the Department of Employment, Economic Development and Innovation (DEEDI).

The paper says that the trial investigated potential production benefits and the economics of deep-ripping forest loam and deep Brigalow clay soils prior to planting leucaena-based pasture.

DEEDI senior pasture agronomist Stuart Buck and Fitzroy Basin Association field officer Joe O'Reagain co-ordinated the discussion and paddock trial inspection by 50 people with the support of other CQ BEEF Biloela group members.

Rockdale decision on hold

The nation's competition watchdog has deferred its decision on the proposed purchase of the Japanese-owned Rockdale Feedlot at Yanco in NSW by Brazilian processor JBS Swift according to The Land.

In a detailed paper released on the takeover last week, the Australian Competition and Consumer Commission has raised dozens of areas where it sees "issues" with the proposal, including the future acquisition of feeder cattle and increased market concentration.

This is despite the ACCC forming the view already that the proposed acquisition would be unlikely to result in a substantial lessening of competition in the market for the supply of processed beef.

According to the paper, ACCC said in its report on the proposed takeover that the merged entity would continue to be "competitively constrained". The ACCC began its investigation into the deal in April.

Better biosecurity

Animal biosecurity programs in NSW have been strengthened with the appointment of a new project leader in emergency preparedness and field operations NSW Primary Industries minister Steve Whan has told The Land.

Whan told the paper that Therese Wright will work from the Industry and Investment NSW head office in Orange as part of the effort to ensure NSW is properly prepared for any biosecurity emergencies.

He says that this position will also work with private and public veterinarians across NSW to ensure they are aware of potential exotic diseases, the associated symptoms and how to report any suspect outbreaks.

Therese Wright has a comprehensive knowledge of animal diseases and pests gained through more than 20 years experience in diagnosing, treating and managing animals both as a private vet and as a government veterinary officer.

Rabbit numbers to rise with rain

Farmers are being urged to keep an eye on rabbit numbers, with populations set to increase over the next few months, further adding pressure on pasture feed, and crops, along with kangaroos and mice plagues says Stock Journal.

Lower Eyre Peninsula resource management officer Rachel Stringer says while there has not been a huge increase in rabbits compared with previous years, strong seasonal conditions meant the numbers of pests such as rabbits and foxes had risen.

Stringer says rabbit numbers are expected to boom over the next few months, as they do every year, and "unfortunately some farmers wait until they see lots of rabbits before they try to implement control methods".

She says with rabbit numbers usually higher in coastal regions, grazing may prove the lesser of two evils n those areas to cropping and says farmers cannot depend on bio-controls unless they back them up with their own programs.

Private buyer eyes Naracoorte yards

Naracoorte Regional Livestock Exchange - which currently turns over $150 milling annually - may be about to become South Australia's second privately-owned saleyards according to a report in the Stock Journal.

The paper reports that a large agribusiness company has made an approach to Naracoorte Lucindale Council about the potential sale - or long-term lease - of the facilities, which have not lifted their rates for three years.

Mount Compass is the State's only privately owned yards, built around 20 years ago by ProStock agent Kym Endersby, although the SA Livestock Exchange at Dublin is owned by a consortium of stock agent firms and private investors.

South-East agents and producers fear a change of ownership may produce a hike in yard fees for vendors, but the council has been quick to reassure all parties that no formal offer has yet been made.

MLA UPDATE

Weak Korean trading activity this week

02 July 2010

Australian beef exporters reported quiet trading to Korea this week. A seasonal weakening in beef consumption, lower Korean won and sufficient beef stocks were all mentioned by traders as factors contributing to the slower trading activity. 

Current trading conditions have subdued prices in the Korean wholesale market. The value for the majority of imported beef cuts and domestic cattle carcases decreased throughout the entire month of June (HKJM). However, market insiders are expecting beef consumption to rise slightly during the Korean summer holiday period from mid July to mid August this year, with increasing customer traffic in foodservice outlets.

The Korean won tumbled this week to 1US$/1,233KRW on Friday, as Moody's Investors Service commented that it may downgrade Spain's credit rating - increasing concern that Europe's debt crisis will impact the global economic recovery (Bloomberg).

Cattle market wrap

02 July 2010

Cattle yardings up for first half of 2010

National saleyard throughput for the first half of the year at MLA's NLRS reported markets lifted 5% compared with the same period in 2009, while numbers remained steady with the five year average.

While yardings were higher, an increased proportion returned to the paddock, with restockers keen to capitalise on the better seasonal conditions. Restocker purchases of vealer steers jumped to 47% of offerings, up from 42% in 2009, while yearling steers increased from 23% to 33%. Yearling heifer purchases by restockers increased from 14% in 2009 to 22%, while cows increased from 6% last year, to 9% in 2010. 

Numbers in Queensland were 14% higher between January and June, despite the wet conditions and flooding significantly hampering sales across central and western regions. Dalby and Toowoomba Landmark were the only markets to record lower supplies for the period, falling 3% and 13%, respectively. The largest increase was at Longreach, where offerings grew by 46% year-on-year, even though the first couple of sales for the year had to be postponed with cattle unable to be transported due to flooding. Warwick yardings increased by 22%, with much of the supply area not receiving the extensive rainfall that fell across some areas of the state.

NSW offerings increased 4% for the six months, with almost 20,000 more cattle penned. While most markets had similar yardings to the same period last year, the increase was assisted by larger numbers at Casino (up 34%). Yardings at Dubbo fell by 10% and Gunnedah 9%, with a large portion of the western supply region impacted by floodwater flowing down from the north early in the year. Furthermore, producers were also able to hold onto stock given the excellent seasonal conditions.

Victoria went against the trend, with yardings falling by 2% for the six months. The decline was despite a 12% increase at Wodonga, and the generally higher prices on offer compared with last year. After a number of years of drought, many producers did not have the cattle to offload and were keen to hang on to breeding cattle for herd rebuilding.

SA supplies improved by 10,000 head or 9% year-on-year, with Naracoorte and Mt Gambier accounting for most of the increase, while numbers at the SA LE declined by 37%. Ongoing dry conditions across much of WA resulted in throughput increasing 5%. Finished cattle were scarce, with most young cattle going to feed or back to the paddock.

WA supplies contract

Cattle throughput at MLA's NLRS reported saleyards in WA fell 29% compared with last week, as the quality of stock offered continues to be plain. Last week's rainfall did little to help improve conditions, with many producers still supplementary feeding stock.

A drop in calves offered at Muchea accounted for most of the decline in overall supplies for the week, while pastoral cattle made up a fair percentage of the yarding, with quality very mixed. Some cows offered were in very poor condition, although there was also some reasonable grown steers presented that received strong competition from live exporters. Any grainfed cattle were in strong demand from local butchers and wholesalers.

Numbers at Great Southern almost halved on last week, with most of the yarding made up of young cattle in store condition, which were purchased by either feeders or restockers. Cow prices remained steady, with a decent line of C3's selling between 136¢ and 141¢/kg lwt.

US prices decline but above year ago levels

02 July 2010

The imported beef market in the US continued to trade lower this week, despite total imported beef volumes remaining tight. The CIF indicator price for imported 90CL shed 2.5¢ on last week, to 149US¢/lb CIF, while in A$ terms the indicator gained 9.2¢, to 359.8A¢/kg FAS - largely due to the lower A$.

Despite the recent downward trend in the US imported manufacturing beef market, prices for 90CL manufacturing beef remain 16% above year ago levels. The monthly June average for imported 90CL is 20% above a year ago, and 15% up on the five year average, at 155.1US¢/lb CIF.

New Zealand (NZ) cattle production started its dramatic winter seasonal decline in mid-May and appears to be now heading below year ago levels (according to NZ weekly slaughter figures). Lower NZ production is likely to further pressure supplies available for the US market. According to US Customs Bureau data, up to 28 June 2010, US beef imports from New Zealand were 9% lower than year ago levels.

Japan demand mixed

02 July 2010

Interest in Australian beef from Japan varied this week, with some items receiving more attention than others, while overall trading was still relatively subdued. Inquiry for chilled grassfed beef has slightly improved, particularly on the back of the A$ depreciation this week.

However, Japanese buyer expectations for lower prices did not materialise, as export prices in US$ terms were maintained at a similar level to last week, possibly due to firm demand from other markets.

In the Japanese wholesale market, demand for imported beef remained slow, with some speculate that the market may have bottomed out. Chilled grassfed fullset prices increased 10 yen/kg week-on-week to 735 yen/kg this week - the first rise since April.

Chinese beef imports jump 30%

02 July 2010

Chinese beef imports jumped 30% year-on-year during the first five months of 2010 to a record 5,696 tonnes swt, according to official statistics from the Chinese Customs Bureau. Driving the increase was the continued strong demand for beef in China, with higher imports of both New Zealand and Uruguayan beef more than offsetting falls from Australia and Brazil.

Impacted by reduced production during the first quarter of 2010, Australia's imported beef market share in China decreased to 26%. Australia remained the dominant supplier of chilled loin cuts to China during the period, despite the tighter supplies and high A$ pushing chilled prices 46% higher on last year, to average A$21.23/kg.

Imports of Brazilian beef, influenced by reduced supplies and stronger competition from other markets, fell 27% year-on-year, to only 261 tonnes - making up 5% of total imports between January and May.

During 2010, Uruguay has emerged as the dominant frozen beef supplier to China. Beef imports from Uruguay for the five months trebled on the same period in 2009, to 2,780 tonnes swt - making up 49% of total imports. China also imported 30% more beef from New Zealand during the period (1,155 tonnes swt).

Beef exports up 6% in June

02 July 2010

Australian beef and veal exports for June increased 6% year-on-year, with higher shipments to the US, Korea, Indonesia, Taiwan and Russia helping to offset a decline to Japan. Exports for the month totalled 87,212 tonnes swt - the highest monthly total since March last year, as increased production throughout May and early June facilitated a rise in shipments.

Reflecting relatively strong Korean consumer beef demand, combined with reduced domestic production, Australian beef exports to Korea were a record for June, at 12,109 tonnes swt. Korea has exceeded expectations during the first half of 2010, with shipments up 17% year-on-year, even though competition from the US has increased.

Weak market conditions in Japan had Australian beef and veal exports for June back 14% year-on-year, to 27,691 tonnes swt. Japanese beef demand is seasonally sluggish throughout June, while beef inventories are reportedly adequate.

Shipments to the US jumped 12% year-on-year, to 24,434 tonnes swt, partly assisted by the lower A$. So far in 2010, exports to the US have contracted 28% year-on-year, to 105,762 tonnes swt.

Exports to Taiwan reached their highest level since December 1998, at 4,058 tonnes swt during June, while shipments to Indonesia totalled 4,316 tonne swt - up 12% on the same period last year. Russia also continued to take steady volumes of Australian beef, with 3,518 tonnes swt shipped in June - taking exports for the first six months of 2010 to over 15,000 tonnes swt, up 149% on 2009.

Little direction in winter livestock markets

02 July 2010

There has been few changes in livestock markets in recent weeks, with lambs and sheep still close to winter highs, and the normal winter cattle price rises on hold for now. 

There was a 14% fall in cattle yardings this week, following significant declines in numbers in all southern states. This helped to hold the Eastern Young Cattle Indicator and national trade indicator 1¢/kg cwt either side of last week's rates.

Any resumption of the winter price rises for cattle is dependent on the A$ stabilising (or declining) and a pick up in Japan and US buying. While demand from Korea, Russia and South East Asia is strong, and the domestic market holding, demand has been weaker from our two largest export markets, Japan and the US.

Japan is currently in its wet summer season, a period of lowest beef demand, with buying likely to improve from July/August (particularly given current low stocks).

The US beef market remains constrained by fears of a further demand downturn in the second half of this year and continuing high beef cow kills - despite one of the best seasons ever. US cattle and beef prices are still expected to rise over the second half of the year, providing the US doesn't suffer a second recession.

The big question for near-term lamb prices is the timing and extent of the expected early new season lamb flush in NSW, particularly on trade and heavy lamb values. The top season in many areas has resulted in many sucker lambs being 2-4 weeks ahead of normal.

Uruguay chases up the herd

02 July 2010

The Uruguayan Ministry of Livestock, Agriculture and Fisheries (MGAP) is supporting producers and the cattle supply chain in moving towards the complete implementation of Uruguay's cattle traceability system. With the objective of reaching full traceability by 2011, the government is currently aiming at overcoming issues regarding documentation (El agro).

Since September 2006, the Uruguayan government has required mandatory identification of all new born cattle, starting from the first movement, or within six months of birth. The governments' initial objective was to have the entire cattle herd in the system by April 2010 but, given delays in the uptake, the due date has been extended until 1 July, 2011.

The traceability system, which began in 2003 as a tool to aid the control of disease outbreaks and assist in the opening of new markets, is now the most advanced traceability system in South America. It includes full electronic individual animal identification, including information such as location, movements, breed, sex and treatments (INAC).

Uruguayan cattle industry faces supply concerns

02 July 2010

The Uruguayan meatpacking industry has become increasingly anxious about the high female cattle slaughter levels recorded during the past two years, with concerns as to how it will impact beef production moving forward.

Uruguayan cattle slaughter rates increased in both 2008 and 2009, mainly the result of a severe drought that hit eastern South America - which also resulted in the loss of a large number of calves. Assisting the higher female cattle slaughter levels of recent years was also the need for producers to maintain cash flows, enticed by periods of strong cattle prices.

The Uruguayan Meatpacking Industry Association forecasts a drop in cattle supplies for 2011, which will impact export volumes.

Economic growth to spur Korean meat demand

01 July 2010

Demand for feed corn in South Korea, the world's third largest corn buyer, is expected to increase 5% in 2010, as the continued economic recovery boosts meat consumption, according to Nonghyup Feed Inc. (Bloomberg).

A spokesperson from Nongyup stated that Korean demand for livestock products is very sensitive to household incomes. It is expected that income improvements throughout the second half of 2010 will flow through to meat demand. The South Korean government revised its Gross Domestic Production (GDP) outlook for 2010 to 5.8% - compared to 5% earlier in the year, boosted by surging exports and strong domestic demand (Bloomberg).

The rebuilding of Korea's cattle herd became increasingly evident early in 2010, with an 8% year-on-year rise in cattle numbers during the first quarter of the year, to 2.7 million head. Increased production in previous year, especially in 2008 and 2009, impacted the number of cattle available for slaughter in early 2010, with slaughter levels falling 12% for the first four month of 2010. During the same period, Korean beef imports from Australia, US, New Zealand and Mexico increased by 16% (KITA).

US gearing up presence in Japan

01 July 2010

Japanese imports of US beef continue to expand, as the US Meat Export Federation (USMEF) gears up another marketing campaign in order to regain market share they lost after the BSE outbreak in December 2003.

Japan imported 36,082 tonnes swt of beef in May, up 12% compared with the same period last year, however import volumes in May 2009 were particularly low given the very uncertain economic and beef demand outlook. Imports from Australia grew 2% year-on-year, to 25,357 tonnes, while US shipments increased 34% year-on-year, to 6,131 tonnes - but still only 30% of pre-2003 BSE levels.

Beef imports from the US are expected to increase further in coming months, boosted by higher production, with the USMEF promotions expected to get into full-swing during this period. Its recent marketing activities include American beef cooking seminars for popular female 'bloggers' (owners of highly accessed websites), "Lunch box boys" recipes by young males, and a gift campaign to win 100kg of US beef (promoted under a theme "Unexpectedly healthy, American Beef").

Japan maintains the bi-lateral import protocols with US that all beef must be sourced from cattle less than 21 months of age, with Specified Risk Materials (SRMs) removed. Despite ongoing pressures from the US to relax the regulations, there have been no further reports to confirm the progress of beef import negotiations, since two countries last met for discussions in April.

Live exports to fall in 2010-11: ABARE

01 July 2010

Australian live cattle exports are tipped to fall 6% for the 2010-11 fiscal year, to 850,000 head, after reaching 906,000 head in the current 2009-10 year. The 6% decline will be largely due to a 17% fall in numbers to Indonesia, Australia's largest market, although rising exports to the Middle East and the rest of south-east Asia will slightly offset the decline, according to ABARE's recent release Australian Commodities June quarter 2010.

Indonesian demand has been the main driving force behind the growth in live cattle exports in recent years, with numbers almost doubling to over 700,000 head for the five years to 2008-09 (ABS). Over the same period, beef and veal exports to Indonesia have grown, rising from 8,748 tonnes swt to 38,089 tonnes in 2008/09 (DAFF).

The growth in shipments to Indonesia in recent years has been facilitated by the expansion of the Indonesian feedlot industry, which typically finishes Australian cattle for slaughter.

However, ABARE noted concerns that live export numbers to Indonesia may have peaked for the short term, with Indonesian authorities limiting permits and enforcing a 350kg maximum weight limit on all live cattle that enter the country. Some herd rebuilding in northern Australia following a return to better seasons is also expected to limit the availability of suitable cattle for the live trade.

Japan FMD ceasing

01 July 2010

The containment of foot-and-mouth disease (FMD) is progressing in Japan, with movement restrictions in the infected areas gradually being removed.

The unprecedented FMD outbreak in the Miyazaki prefecture has seen almost 200,000 cattle and pigs culled since 20 April, 2010. This has resulted in significant damage to the local livestock industry, as well halting Japan's Wagyu beef exports (due to a self-imposed export ban of beef products). The export ban is still in place, except to Hong Kong and Macao.

Japan's Shokuniku Sokuho has reported that the entire Miyazaki prefecture will become restriction free on 16 July, provided there is no further FMD case reported. The last case was found on 18 June.

In 2009, Miyazaki was the third largest prefecture for beef cattle in Japan, supplying approximately 15% of all Japanese black Wagyu calves to feeders nationwide. There has been no evidence so far to confirm that the outbreak has affected beef consumption, or beef supplies in Japan.