JEDDAH – Saudi Arabia remains Australia’s largest meat export market, accounting for 30 percent of shipments to the Middle East and North Africa (MENA) region, followed by the UAE at 25 percent and Kuwait at 13 percent, Meat and Livestock Australia (MLA) reported recently.
Significant growth in beef exports was driven by a surge in shipments to Saudi Arabia as Australian beef gained market share after Brazil was banned from the market in late 2012.
Exports to Saudi Arabia totaled 18,944 tons shipped weight in 2012-13, up more than four-fold year-on-year, making Saudi Arabia Australia’s largest beef market in the MENA region.
The Brazilian ban in Saudi Arabia has, however, increased competition in other beef markets in the region, with increased quantities of Brazilian beef entering Jordan and the United Arab Emirates (UAE), MLA said.
MENA region continues to grow as an important market for Australian red meat exports with volumes for the 2012-13 financial year hitting 160, 963 tons shipped weight, an increase of 32 percent on the previous record set in 2011-12.
The MLA report said lamb exports hit record levels, totaling 60,700 tons, up 35 percent year-on-year, while beef shipments surpassed the record set in the previous financial year, totaling 49,147 tons, up 46 percent.
Mutton exports rebounded to their highest level since 2008-09, to 51,116 tons, indicating growth of 18 percent year-on-year.
This has impacted primarily on Australian frozen beef exports, with frozen shipments to the UAE and Jordan down 21 percent and 19 percent respectively.
Lamb exports have benefited from growth to Bahrain, Iran and Kuwait.
Australian lamb exports to Bahrain totaled 9,713 tons shipped weight in 2012-13, up from 229 tons in 2011-12.
Exports to Iran, although sporadic, totaled 7317 tons in 2012-13, up more than two-fold year-on-year, while shipments to Kuwait increased 77 percent to 3833 tons.
The UAE remains Australia’s largest lamb market, accounting for 25 percent of Australian exports, while Jordan also took large quantities of Australian lamb in 2012-13.
The MENA region has historically been an important destination for Australian mutton exports, with this remaining the case in 2012-13, with 35 percent of all Australian mutton exports heading to MENA.
The growth in Australian mutton exports to all global destinations in 2012-13, to 144,105 tons shipped weight, up 62 percent year-on-year, was a major driver in the increase in shipments to MENA.
Australian beef and veal exports for May surged into uncharted territory, exceeding the previous monthly high and breaking through 100,000 tons swt for the first time.
According to DAFF, exports for the month totaled 103,207 tons swt – 19 percent above the corresponding month last year, and over 8,000 tons swt greater than the previous monthly record set in November 2006 (94,693 tons swt).
Historically high beef production facilitated the record breaking month, as average weekly eastern states slaughter during April and May were up 18 percent year-on-year, at 137,535 head and 157,093 head per week, respectively – driven by drought and deteriorating seasonal conditions, especially in Queensland. Additionally, the lower cattle prices experienced throughout the month helped offset the impact of the high A$ (albeit falling), maintaining Australian beef in a competitive position in most markets.
For the past 12-month period (June 2012-May 2013), Australian beef exports have exceeded 1 million tons swt for the first time on record. Importantly, of the 1 million tons swt exported, 30 percent went to markets other than the US, Japan and Korea, compared to only 11 percent in 2006 – highlighting the increasing demand for red meat from developing markets.
Exports to Japan, Australia’s largest export beef market registered a solid month at 30,374 tons swt. While this was 1 percent below the corresponding month in 2012, it was the highest volume since July last year. Overall Australian trading conditions to Japan remain tough, with the combined influence of a sluggish economy, unfavourable currency levels and increased competition from US beef.
For the first five months of 2013, Australian beef exports to Japan are down 4 percent year-on-year, at 115,827 tons swt.
Australian beef volumes to the US continue to be below expectations, but largely due to the positive influence of stronger competition for manufacturing beef, especially through Asia and the Middle East. Australian beef exports for the past month totaled 19,580 tons swt – steady year-on-year and the highest volume so far in 2013. Lower than expected beef demand, along with higher than expected New Zealand and US cow beef supplies has also dampened US importer buyer intentions, with exports for the first five months of 2013 down 16 percent year-on-year, at 84,477 tons swt.
The battle for the mantle of Australia’s third largest beef export market continues to heat up between China and Korea. Korea, the long-time holder of the third position, registered 12,423 tons swt of Australian beef during May (up 36 percent year-on-year), compared to 11,486 tons swt to China (up 1520 percent year-on-year) – which had exceeded Korea for the past three months. Korean demand has been steady throughout 2013, albeit compared against a very sluggish start to 2012, with exports for the January to May up 23 percent year-on-year. The competitive landscape in Korea continues to be tough for Australian product, especially with US product entering the market at a lower tariff rate.
China continues to be the most promising market for Australian beef exports in 2013, with shipments in May totaling 11,486 tons swt – up from only 709 tons swt for the corresponding month in 2012 and just shy of the all-time high set in March, at 12,320 tons swt. The surge in demand from China, and subsequent monthly volumes, has forced a rethink for 2013 year-end expectations, and with shipment for the first five months of 2013 totalling 51,176 tons swt, exports for the full year are expected to come close to 100,000 tons swt. Illustrating the rapid growth to China, for the past 12 month period (June 2012 – May 2013) Australian beef exports to China totalled 82,418 tons swt – more than double the volume exported in the previous 12 years combined.
Australian exports to the Middle East totalled 6,168 tons swt, another highest monthly total on record, and underpinned by sustained demand from Saudi Arabia, with shipments reaching 3,773 tons swt. Exports to the region for the first five months of 2013 are up 122 percent year-on-year, at 25,292 tons swt.
Exports to the EU also continue to track well above year ago levels, as the improvement in grainfed market access assisted volumes, with exports for May totaling 1,975 tons swt.
Other markets to register improved year-on-year volumes for the month included Indonesia (up 6 percent), the Philippines (up 39 percent), Malaysia (up 82 percent) and Taiwan (up 5 percent). In contrast, export volumes to Russia and Singapore continue to be challenged by strong competition from Brazil, with shipments back 51 percent and 13 percent respectively, year-on-year.