An industry workshop held in Brisbane on November 25 provided insight into the impact of the drought on cattle and beef supplies and the feedlot sector over the course of 2004 and how Australia’s key beef export markets are expected to perform next year.

It is feared that if decent rain is not received over the next six weeks across cattle producing regions, prospects to replenish cattle herds may be dire. It was agreed that an improvement in the season in early summer would limit the number of cattle available for slaughter and would further squeeze processor margins in 2004. Feedlot activity is expected to recover in 2004, as feed grain prices ease and demand improves.

The US was judged to be next year’s star performing export market with Australia’s 378,214 tonne quota expected to be filled over the next few years, spurred on by attractive returns in this market. Although export volumes to Japan are expected to be constrained by tight supplies, this market is projected to continue offering Australian exporters opportunities, with an increasing preference by Japanese importers towards individual cuts rather than fullsets.

Source: Meat & Livestock Australia