Brazilian cattle in Vietnam could have an upside for Australia

Brazilian cattle in Vietnam could have an upside for Australia

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Exporters have little doubt Brazil will soon gain live-ex access to Vietnam.

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AUSTRALIAN livestock exporters have little doubt beef producing powerhouse Brazil will soon gain access to Vietnam for cattle.

There is no panic, however. In fact, the experts say there could even be some upside.

Vietnam is Australia's second largest live cattle market, with exports for the calendar year-to-date sitting at over 180,000 head, up 30 per cent.

SEE ALSO: Indonesia's taste for beef evolves

Michael Patching, the Asia Pacific manager for the industry's Livestock Export Program, said there would always be external threats to Australia's markets.

But Australia definitely had a point of difference in Vietnam via its ability to provide readily-available, healthy, consistent quality cattle on tap, he said.

BRAZIL FACTOR: Michael Patching, an in-market expert on live exports to Vietnam, speaking at the recent LIVEXchange conference in Townsville.

BRAZIL FACTOR: Michael Patching, an in-market expert on live exports to Vietnam, speaking at the recent LIVEXchange conference in Townsville.

"That has meant throughput for abattoirs," Dr Patching explained.

"Five years ago, Vietnamese abattoirs were doing five to 10 head a night and now the largest one is doing 200 head a night.

"We are working towards most doing 50 a night, which is a massive shift in the market.

"So buyers can rely on abattoirs to consistently have them. We will need to lean on our point of difference when Brazil comes."

Despite the extra distance involved, Brazil is expected to be able to land cattle in Vietnam at a very competitive price and Queensland Livestock Exporters Association president Greg Pankhurst said if the Vietnamese can produce meat cheaper by feeding Brazilian cattle they certainly would do it.

Dr Patching agreed the trade would be price-driven.

However, his take was given the pending shortage of Australian cattle, Brazilian supply might, in the long-term, result in greater gains for Australia in Vietnam.

"They may perhaps fill gaps in supply while we don't have many slaughter cattle to offer," he said.

"When those Australian cattle come back into the system, and are competitive price-wise, we'll take the market share back again because we have the relationships."

Australia had done a lot of good work in Vietnam and while it was true Brazil could piggyback off that, Dr Patching said: "If we are always worried about a competitor piggybacking on the good work we do, we wouldn't do any work.

"The advantage that work gives us is through building up secure supply chains. It means there becomes a reliance on Australian cattle."

He also pointed out Vietnam was the largest importer of Indian buffalo meat in the world and regional cattle were also traded into the system.

"A lot of that IBM is sent through to China. If there was a market for it to remain in Vietnam it would. Some it stays but it has a specific place," he said.

It had not displaced Australian cattle.

Dr Patching also made the point that sending more feeders into Vietnam would make Australian cattle price-competitive with Brazilian slaughter cattle.

The majority of what we send is slaughter cattle but almost 36,000 feeders have been sent to Vietnam this year, up more than 200pc year-on-year.

PRODUCER VIEW: NT pastoralist Dan Lynch, who supplies cattle for the live export trade.

PRODUCER VIEW: NT pastoralist Dan Lynch, who supplies cattle for the live export trade.

Northern Territory producer Dan Lynch visited Vietnam earlier this year and said the potential for growth of the live-ex trade there was 'exponential'.

"One of the real surprises was the kill facilities had very high standards and were successfully value-adding - that is very encouraging that they have the potential to sell a higher-priced product," he said.

Stunning is now commonplace in Vietnam, having been introduced by Australia.

It's used on local cattle as well and Dr Patching said it would be used on Brazilian cattle.

RELATED: MLA boss calls out undervaluing of live-ex

The story Brazilian cattle in Vietnam could have an upside for Australia first appeared on Farm Online.

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