Dry winter boosts beef exports by 19 per cent

carcasses-2

Australia currently holds a 22.8% advantage for frozen beef exports – with US exports incurring a 50% tariff until the 31st of March 2018, whilst Australian exports incur a 27.2% tariff.

Australian beef exports for the month of October lifted 19%, equating to 86,279 tonnes shipped weight (swt), albeit off a low base compared to the same period in 2016 when supplies were at their most restricted.

Underpinning the lift has been dry winter conditions across many parts of Northern Australia.

Of note were significant increases in volumes to Japan, the US and China from year-ago levels.

Beef shipments to Japan totalled 23,079 tonnes swt in October  – up 10% from year-ago levels.   The increased volume to Japan has been predominantly driven by continued demand for grainfed product. Close to half of Australian beef exports to Japan were grainfed beef, which competes with both US beef and Japanese domestic product.

It also reflects the current higher proportion of Australian cattle in feedlots and the limited supply of grassfed beef. The US also recently triggered Japanese tariff safeguard volumes, hampering their competitiveness in the market.

Australia currently holds a 22.8% advantage for frozen beef exports – with US exports incurring a 50% tariff until the 31st of March 2018, whilst Australian exports incur a 27.2% tariff.

Calendar year-to-October exports to Japan totalled 242,635 tonnes swt, now 13% higher than 2016 and 2% higher than the five year average (238,274 tonnes swt).

Exports to the US reached 18,746 tonnes swt, up 60% from October 2016. For the calendar year-to-date, beef shipments have declined 3% year-on-year, to 201,127 tonnes swt.

Exports to the US continue to be challenged by rising US beef production, which has been supporting robust US domestic demand.

While demand for imported product in the US remains current, limited availability combined with high Australian cattle prices has underpinned a reduction in shipments.

US imported beef prices (90CL) have trended higher throughout much of September and into October, lifting 1.5US¢ last week from the previous week’s levels, to 206.6.US¢/lb CIF (up 13A¢, to 587.38A¢/kg CIF).

Volumes to China in October lifted 60% year-on-year to 11,353 tonnes swt. Demand has stayed reasonably buoyant for the year thus-far, despite the temporary ban on exports from some processing plants being only recently lifted. In fact, year-to-October exports totalled 86,174 tonnes swt, up 10% from 2016.

On the other hand, exports to Korea continued their downward trend in 2017 and declined 20% from year-ago levels.

The upturn in US production, and consequently a stronger export focus, created robust competition from US exporters supplying this market. Furthermore, along with lower Australian production, a number of short term factors contributed to reduced Australian beef exports to Korea.

These include triggering of the safeguard tariff, rollout of anti-corruption legislation, on-going economic/political uncertainty and import financing concerns. Calendar year-to-date exports are 16% lower than that of the previous year, at 120,608 tonnes swt.

As part of the Korea-Australia Free Trade Agreement the safeguard volume was recently triggered, with the safeguard tariff increasing from 29.% to 40% for the remainder of the year.

https://www.mla.com.au/prices-markets/market-news/a-solid-october-has-australian-beef-exports-back-in-line-with-2016/

UPCOMING SALES / EVENTS
« November 2017 » loading...
M T W T F S S
30
31
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
1
2
3