Cattle Co-Product Values Lower In 2009

AUSTRALIA - The global financial and economic crises which engulfed economies around the world last year had a deep and immediate impact upon global consumer spending.
calendar icon 14 January 2010
clock icon 2 minute read
Meat & Livestock Australia

Slowdowns in various industries lead to drastic falls in the potential co-product value of livestock, as co-products from medium steers, Japan ox and cows in 2009 all returned about 23 per cent less value than in the previous year, according to Meat and Livestock Australia.

Hide values, traditionally the highest earning co-product, fell drastically in late 2008, as slowdowns in the US automobile industry and the quality leather apparel market sharply reduced demand for hides. Although hide prices staged a gradual comeback throughout much of 2009, hide values still averaged 52 per cent less in 2009 than in the previous year.

In 2009, returns on edible offals were 21 per cent lower year-on-year, with generally lower demand for beef offals around the globe leading to reduced FOB prices. Offals with high collection rates – such as livers and hearts – were particularly affected from poor Russian demand and difficult trading conditions. Dearer Japanese and Korean offals also reduced in value.

The average return per head received for tallow – though fluctuating throughout the year – averaged 15 per cent lower in 2009. Tallow prices, which take their lead from palm oil (used widely as a substitute in manufacturing), fell as a result of increased palm oil supplies at lower prices, as well as lower commodity prices globally.

Meat and Livestock Australia say that meat and bone meal values were higher in 2009, returning 12 per cent more value per head to processors than in the previous year. A high level of enquiry for Australian product from Indonesian feed mills, and its favourable pricing relative to soy meal meant that demand for MBM 50 was firm throughout the year, averaging $650/tonne ex works.

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