As the government has banned city dwellers from going back to their hometowns or villages this Eid Fitr, it is anticipated that beef demand – both fresh and frozen – would be more concentrated in major urban cities like Greater Jakarta.
COVID-19 is hampering beef demand in Australia’s largest cattle export market, Indonesia.
While Indonesia has strong fundamentals for increased beef consumption, short term massive social restrictive measures have suppressed sales and demand and the threat of a recession has flowed through to live export prices.
Meanwhile, Vietnam, Australia’s second largest cattle export market, has been able to manage the COVID-19 outbreak reasonably well and Australia posted the highest first-quarter export numbers on record.
As Indonesia enters the month-long season of Ramadan (24 April – 23 May), the impact of COVID-19 measures will continue to hamper demand for meat across the country.
Shutdown of foodservice outlets, reduced consumer spending and a nationwide restrictive measures have caused a demand shock that could not have been foreseen just two months ago.
As the government has banned city dwellers from going back to their hometowns or villages this Eid Fitr, it is anticipated that beef demand – both fresh and frozen – would be more concentrated in major urban cities like Greater Jakarta.
Following the record $3.85/kg set in March, export cattle prices from Darwin to Indonesia have dropped to $2.80/kg, while quotes out of Townsville have ceased altogether.
It is not uncommon to see prices ease during April, with first round muster resulting in large numbers of cattle being made available for the export market.
However, the continued uncertainty surrounding the socioeconomic implications of COVID-19 in Indonesia has contributed additional downward price pressure on export cattle.
This has led the normally aligned Australian steer prices to become disjointed, with Darwin and Queensland prices falling out of sync with NSW, which has been more strongly supported by restocker demand following solid rainfall in the New Year.
https://www.mla.com.au/prices-markets/market-news/stalling-market-demand-impacts-live-cattle-export-prices/#
