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Cattle Exports To Indonesia Slow Down

07 May 2010
Meat & Livestock Australia

AUSTRALIA - Despite record cattle numbers exported to Indonesia in the first quarter of 2010, there are ongoing concerns around the issuing of Indonesian import permits and an oversupply of cattle in the market.

Australian live cattle exports to Indonesia during the first quarter of 2010 reached record levels, at 142,000 head, as total exports to all markets increased 25 per cent year-on-year, to 220,000 head (Australian Bureau if Statistics). Along with Indonesia, shipments for the first three months of 2010 also increased with the reopening of Egypt (taking 16,000 head), reports Meat and Livestock Australia.

However, while the record shipments to Indonesia during the first quarter of 2010 were largely anticipated, several issues emerged throughout the period which could impact the trade into the middle of the year. The most significant concern continues to be the uncertainty surrounding the allocation of import permits by the Indonesian government, which are not being issued as freely as in previous years. Most importers are receiving permits as required, however, often at reduced volumes.

Despite the increased imports, sales of cattle from feedlots have slowed, leading to some accumulation of animals in feedlots causing oversupply concerns – the result of an increase in boxed beef and offal imports over the period. However, the ongoing impact of this is expected to be short term, live cattle demand is expected to strengthen (assuming import permits are available), as the peak buying period of Ramadan is expected to commence in May.

Additionally, the relatively poor wet season across the Kimberley region has reportedly seen many producers keen to relocate stock, conscious that feed supplies will not be adequate to carry numbers throughout the dry season. In contrast, the excellent wet season across northern Queensland and eastern NT is expected to keep supplies tight.

Given the seasonality in live export prices, the end of the wet season has seen indicative prices fall back to around 160-170¢/kg lwt for light steers ex. Darwin, which is back in-line with slaughter cattle prices. Since the start of 2010, indicative live cattle prices have fall 19 per cent, while in contrast, the “grass-market” throughout Queensland had seen trade steer prices jump by over 20 per cent to the end of April.

TheCattleSite News Desk



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