Meat feeling the squeeze

31 Dec, 2006 09:00 PM
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MEAT and livestock farmers in WA are hoping the New Year will bring them a sort of industry reprieve.

With a scarcity of feed available due to the drought, feed prices sky high, a lack of killing space, feed lots feeling the pinch, Livestock Shipping Services (LSS) out of action leaving contracted bulls in limbo – well the list of industry woes continues, right across the board.

There may be better times ahead for some commodities according to ABARE; however a positive forecast is highly dependent on improved seasonal conditions.

As a result of the drought, in its December quarter forecast ABARE has tipped lamb production to drop by 3pc to the 370,000t mark and lamb slaughter will increase by about 2pc to 19million.

However if seasonal conditions do improve, then the outlook could be reversed.

In the export market, lamb may fall by 4pc to 140,000t as a result of lower demand to the US.

The value of lamb exports is forecast to fall by 21pc to $621m.

Live sheep exports will also decrease by 3pc to 4.1m, which may be a reflection of the lesser amount of sheep exported for Hajj and Ramadan because of the drought.

In the beef and veal sector, ABARE believes there will be an increase in cattle slaughter and beef production.

That in turn could cause the average saleyard price to fall by 13pc to average 280c/kg.

Cattle slaughter is forecast to increase by 7pc to 9m, with an increase in beef production by 4pc to 28m tipped to occur by June.

The increase in slaughter could prove to be a problem for WA as limited kill space placed immense pressure on the state last year.

WAFarmers meat section president Mike Norton said the slaughter capacity in WA was of real concern.

“When there was large-scale hold ups in spring, we’ve got our major abattoir which appears to only be going at three quarter pace, virtually they’re the only ones,” Mr Norton said.

“There are a lot of brokering companies prepared to come into WA and do service-kill to try and put in some competition but the abattoirs that are here are very reluctant to let these people in and provide a service kill.”

“It’s something in the New Year that industry is going to have to sit down and address is our abattoir capacity at peak periods and the inability of the existing plants to cope and their reluctance to enter into service killer arrangements and provide some competition.

“There are some real management issues in the industry which need to be sorted out.”

Mr Norton said from February on there would be a shortage of kill space.

He said if something did not change, there would either be an increase of cattle trucked out of WA live or shipped out to the live export market.

Pastoralists and Graziers Association (PGA) meat and livestock chairman Tim D’Arcy agreed with Mr Norton and said the issue would need to be sorted out sooner rather than later.

“We desperately need someone else to kill livestock in WA,” Mr D’Arcy said.

Exports to Japan were strong in 2006 but an increase in imports from the US this year could cause a 3pc dip to 378,000t.

Korean imports of Australian beef shot up 34pc during the first ten months of last year and according to ABARE things will continue to pick up with an estimated increase of 11pc this year to 134,000t.

Australian beef exports to the US are also predicted to increase, by around 2pc to reach 300,000t.

Live cattle exports are predicted to rise by 8pc to 595,000t as a result of good seasonal conditions in the north of the country.

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