Australian beef and veal exports slumped to a 19-year low in 2022 as farmers rebuilt livestock numbers after years of wild weather, inflationary pressures and labour shortages.
Total beef exports reached just 854,592 tonnes in 2022; the lowest they have been since 2003, when mad cow disease caused a substantial reduction in exports to Asian markets.
A Meat and Livestock Australia spokesperson told Guardian Australia the decline was due to low slaughter numbers and not decreased demand. They predicted exports would lift in 2023 as the national cattle herd was rebuilt.
“The low beef production in 2022 was a result of the national herd rebuild – as producers held on to stock to repopulate their farms rather than getting them processed,” the MLA said. “As a result that national cattle herd is growing in size.”
The Australian agriculture department in its December commodities report forecast a 5% reduction in beef export volumes in 2022-2023 compared with 2021-2022 due to high cattle prices, wet conditions and a limited capacity at processing facilities due to labour shortages.
Rabobank’s animal proteins analyst, Angus Gidley-Baird, said forecasts suggested there would be a substantial increase in beef exports in the second half of 2023 as the reconstruction cycle came to fruition.
“If we’re not producing more, it’s a bit hard to export any more,” he said.
“We had some very dry periods back in 2015 and 2016. Then there was a slight reprieve through 2017 and then 2018 and 2019 were dry again, which caused a large sell-off of cattle.
“Since 2020, we’ve had some fairly good seasons. And people have just been rebuilding numbers. So we haven’t had the livestock numbers to generate the production. And, as a result, our export numbers have been declining from those high levels.”
However, he warned that labour shortages could restrict production growth. The agriculture industry, particularly meat processors, have faced shutdowns and slowed production due to a lack of staff. Last month the agriculture minister, Murray Watt, announced an expansion of the Pacific Australia labour mobility scheme in an attempt to attract more workers to food processing plants, but industry bodies have warned that will spread an already thin workforce even thinner.
Gidley-Baird said, if not dealt with, workforce problems could compound as beef production and herd sizes increased.
“We’ve probably been fortunate that these difficult labour situations have come at a time when we haven’t been pushing the envelope in terms of our volumes and numbers,” he said.
Gidley-Baird added that increased international competition, primarily from the United States, had likely contributed to the lower exports to markets like Japan, where exports were down 8.3%. The high price of Australian beef compared with the US product may have played a role.
However, he said that higher price point, which reflected higher quality, was a boon in some markets: there was a 7% increase in beef exports to China, where more expensive cuts are prized.
“Our export numbers depend on the type of product we’re producing,” Gidley-Baird said. “There’s the beef trimmings that are demanded in the United States, And then there’s high quality marbled, Angus/Wagyu grain-fed products and that’s what Japan and China are looking for.
“There’s been a higher dominance of the latter in our production recently, because we just don’t have a lot of old cows being killed. But, as our herd rebuilds, we will increase our production of that leaner product.”