Grainfed beef exports buck grassfed trend

07 April 2016

Australia exported almost 96,697 tonnes swt of beef and veal in March, taking the first quarter total to 245,775 tonnes swt – 17% below the same period last year (DAWR). However, the makeup of Australian exports has changed over the past twelve months. At 62,282 tonnes swt, grainfed beef exports over the first quarter were up 3% year-on-year and were reflective of the record number of cattle on feed at the end of 2015. In fact, first quarter grainfed beef exports were only slightly below the 62,640 tonnes swt recorded in 2007. The difference between current levels and 2007 is the greater proportion of grainfed cattle on shortfed programs destined for the domestic market.

Where did the grainfed beef go in the first quarter? Two growth markets stood out.

Firstly, grainfed beef exports to South Korea increased 63% year-on-year, to a record 13,188 tonnes swt. Korea imported large volumes of grainfed blade, chuck roll and shin shank during the first three months of 2016. South Korea also remained a strong market for grassfed beef, with shipments up 6% during the first quarter, at 27,914 tonnes swt.

Secondly, grainfed beef exports to China in the March quarter were up 70% year-on-year, at 5,154 tonnes swt – however, it should be noted this is still 11% below the 2014 volume. While Australian grainfed beef exports to China appear to be unaffected by the increasing volume of beef into the market from Brazil, Australia’s grassfed trade has declined. During the first quarter, Australian frozen grassfed beef shipments – the bulk of what Brazil exports – into China declined 27% year-on-year, to 17,223 tonnes swt. However, given the reduced volume of grassfed cattle coming through to slaughter so far this year, this trend is not surprising nor vastly different from many other markets. In the first quarter of 2016, Brazil exported 35,599 tonnes swt of beef to China (Global Trade Atlas).

Grainfed exports to Japan during the first quarter were back 18% year-on-year, at 29,209 tonnes swt. However, this volume is not far below the five-year average and it still represents 47% of Australian grainfed beef exports.

After the very strong trade in 2015, beef exports to the US over the first quarter were back 34% year-on-year, at 69,611 tonnes swt. However, this decline is off a record high base and is still 10% above the five-year average.

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