US attacks temper

28 Nov, 2001 10:00 PM


MOST people are aware of the impacts, both immediate and potential, of the lifting of US lamb tariffs, BSE striking in Japan and the terrorist attacks on the World Trade Centre.

But as the MLA producer forum heard, no-one felt the impact first hand like Meat and Livestock Australia economic planning and market services general manager Peter Barnard.

It was while in the US to finalise the removal of the tariffs that Dr Barnard saw the potential negative developments unfold before his eyes, driving past a burning Pentagon on his way to work.

"Three remarkable days," he described, "the first day in part celebrating a positive development for our industry, the removal of the US lamb quotas, days two and three representing potential negative developments for our industry".

Dr Barnard said demand for beef in Japan had slumped since the discovery of BSE, with retail sales dropping 33pc in September and 69pc the following month.

"Along with the slump in retail and food service sales in Japan, Australian beef shipments to this market have dropped," he said.

"October 2001 total exports were at similar levels to those of last year, but chilled beef exports were down by one third.

"More significantly, for the first two weeks of November beef exports were 57pc lower than last year and chilled exports were 73pc lower."

But as one producer put to the forum, the disease may provide Australia with an opportunity to exploit its clean and green image once the scene had settled.

MLA overseas operations general manager Mike Hayward agreed, saying protecting and promoting Australian red meat in overseas markets has never been more important.

"MLA has been quick to respond to the BSE crisis but the foundation for our response was laid over many years of investment by the industry in building Aussie Beef in Japan as a safe and nutritious product, raised in the clean, natural Australian environment," Dr Barnard said.

The most recent statistics show Aussie Beef is increasing in sales, despite the BSE crisis.

Dr Barnard pointed out other positives in an industry shrouded with uncertainty, the most significant being the Australian dollar.

"The Australian dollar has dropped from about 65c to 50c over the past 18 months," he said.

"This depreciation has added about 60c to cattle prices and 20c to sheepmeat prices."

He said the strength of the lamb industry lay with its demand domestically.

"After falling like a stone throughout the 1980s, demand flattened in the early 1990s and has increased 17pc over the last two years," he said.

The predicted dipping of lamb supplies in Australia by 5pc over the next six months and falling world sheep flocks also acted as bonuses for the industry, he said.

"For beef, perhaps the positives are a little bit more elusive," he said.

"Chilled beef shipments to Korea have doubled over the last few months and total shipments are up by about two-thirds.

"If the Japan market does slump over the medium term, as I expect, the performance of the Korean market will become even more critical."



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