Australian beef exports have dropped for the first time after a 29-month run of year-on-year growth, following a drop in shipments to China by 12 per cent, as a result of ongoing Covid-19 ripple effects.
Meat & Livestock Australia said a “subdued demand in China” had impacted on Australia red meat exports in the last month, as total Australian beef exports eased by two per cent year-on-year in February.
Australian sheepmeat exports in February were also steady year-on-year, however, shipments to China almost halved, following a 31-month run of year-on-year growth.
One of the biggest challenges for Australian beef and sheepmeat in China is getting product through under-staffed port bottlenecks, said Meat & Livestock Australia market insights manager Tim Ryan.
“In 2019, 60 per cent of Australian beef exports to China went through Shanghai port, followed by Tianjin port at 16 per cent. Australian sheepmeat exports were more geared towards Dalian port, which accounted for 47 per cent of shipments, with Shanghai accounting for just 4 per cent of Australian sheepmeat in 2019," said Ryan.
“Fortunately, while still needing to process large volumes of containers, China’s ports have begun kicking back into gear, as port staff return to work and China’s lorry drivers begin the massive task of distributing product through to inland cities.”
Australian red meat exporters need to take into consideration the global imbalance of reefer (refrigerated) containers, as many have built up in China’s ports but have not been emptied.
“Even as ports begin to process containers and product is distributed throughout China, it may be weeks before reefers return to global circulation – until that happens, reefer freight rates will remain elevated,” said Ryan.
In October, the Australian Meat Industry Council CEO Patrick Hutchinson signed a Memorandum of Understanding with the China Meat Association, on behalf of the Australian Meat Industry Council, Meat & Livestock Australia and the Australian Meat Processor Corporation.
