Cooling trade tensions between the United States and China should be considered a win for Australian agriculture, including beef which has just cemented the Asian consumer powerhouse as it's number one market volume-wise.
That's the word from economic experts in the wake of the signing this week of phase one of the US-China trade deal.
While agreements on US supply of soybeans and pork appear to be there, most detail of interest to agriculture and particularly red meat have been hidden in confidentiality clauses.
However, US beef interests are heralding phase one as welcome news. The US is both a major competitor and customer of Australian beef and could present far greater competition in China if it could gain more favourable market access.
If China were to relax its lifetime traceability or non-hormone growth promotant requirements, for example, the US would have overcome significant hurdles. Global trade commentary and market chatter has not suggested any Chinese moves in that direction.
The US's National Cattleman's Beef Association said it was optimistic the deal would bring long-lasting relief to farmers and ranchers who had been targeted with China's retaliatory tariffs for many months.
In particular, the NCBA pointed to China's non-tariff barriers and "restrictions on science-based production technologies" as something it considers must be addressed "so that Chinese consumers can enjoy the same high-quality, safe and sustainably-produced US beef that Americans have enjoyed for decades."
NCBA boss Colin Woodall told this publication his organisation had spent a considerable amount of time lobbying the Trump Administration regarding expanded trade with China.
"We see a lot of potential in China and want to have an opportunity to sell beef to them," he said.
"Japan remains our top market, and it is a market we care greatly about," he said.
"But we are always looking at new markets in which to sell our product."
Regardless, NAB Group Economics associate director Phin Ziebell said Australian beef had good opportunities in China before the US-China trade fall-out and that would remain the case.
"The other side of the coin, of course, is that Australia has close geopolitical ties to the US but is dependent on China economically, so the extent to which any tensions between the two can be avoided is a great thing for Australia," he said.
For the first time ever, China has moved into top place customer volume-wise over a calendar year, taking more than 300,000 tonnes of Australian beef shipped weight in 2019, a jump of 84 per cent year-on-year.
Much of this was driven by the massive hole left in animal protein supplies in China as a result of African Swine Fever wiping out an estimated 40pc of China's pig population.
Mr Ziebell said while Chinese pork prices look to have topped out, there was 'still plenty of way to run' on beef demand and thus cattle prices in Australia if a reasonable home season eventuates.
"Even if Chinese beef prices top out now, there is still uplift at a producer level for cattle markets in Australia from the Chinese dynamic," he said.
"Australia has a three-year herd rebuild process ahead of it and export fundamentals are very strong, which means further upward pressure for over-the-hooks indicators and saleyard prices once restocker demand comes online.
"We can't see the China demand going away any time soon."
The latest beef export figures show global demand is robust - the amount exported in 2019 sits in the top three of all-time figures.
Rabobank senior animal protein analyst Angus Gidley-Baird said Australian cattle prices would not be near as healthy as they were without that solid international demand.
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The story What cooling US-China trade tensions means to Aussie beef first appeared on Farm Online.