“Too many other factors are working in world protein markets to be sure that Australia’s expected shortfall will flow on to greater demand for our beef exports,” she said.
A predicted 17% reduction in Australian beef exports in 2020 might help stabilise world prices rather than increase them for other supplying countries.
Australia is going to do what it would in a normal year, without covid-19, and that is rebuild its herd after widespread rain.
NZ might have benefited had all other things remained normal but the disease-induced slowdown in world markets changed the outlook, Croad said.
Another factor is the proven ability of Australia to bounce back after adverse events and bring huge numbers of cattle to market, even in a down year.
Rabobank has estimated its total beef production will be 2.1 million tonnes slaughterweight from 7.3m head killed and exports will fall to 1m tonnes.
“However, projections for 2022 and 2023 have them getting back to where they were last year in drought offload,” Croad said.
During the first four months of this year Australia exported 358,000t of beef, compared with 363,000t in the corresponding period last year and 343,000t as the five-year average.
Uncertainties about supply and demand are everywhere around the world, she said.
China’s demand for imported beef, though recovering post-covid, is not expected to match last year’s huge consumption.
Meat plant disruption in the United States will only delay the kill but not remove cattle from the market altogether.
“When the US companies get cranking again that will dampen demand for imported beef.”
More US exports could also flow to China under the new trade agreement between the two countries.
Right now NZ manufacturing beef exports are benefitting from a false shortage in the US and increased demand as the food service sector starts to reopen.
China bought 304,000t of Australian beef last year but diplomatic tensions have surfaced as three Queensland and one New South Wales plant have been suspended.
The Australian government has backed a call for an investigation into the origins of covid-19 to better counter such pandemics in the future.
An Australian analyst said the four suspended plants represent about 35% of beef exports to China, which had been on track to bring in $3.5 billion this year.
Trade Minister Simon Birmingham said the suspensions relate to labelling and health certificate requirements based on very technical issues dating back as far as a year.
The Meat Industry Council said China’s requirements are taken very seriously and while not desirable, issues such as these have been dealt with before.
