Aussie cattle inventory to grow by 1.1 million
The national cattle herd rebuild is set to continue, according to Meat & Livestock Australia’s (MLA) first Cattle Industry Projections update for 2022. The national herd is projected to grow by 1.1 million - or 4% - to 27.2 million head as the rebuild becomes more pronounced. In addition, slaughter numbers are forecast to rise by 11% in 2022, driven by increased supply.
MLA’s Market Information Manager, Stephen Bignell, said that the ongoing rebuild is positive for the red meat and livestock industry, however, the pace of the rebuild will vary across different states, underpinned by a third year of favourable seasonal conditions for southern Australia.
"Herds in the southern states of New South Wales and Victoria will mature favourably, with large numbers of high-quality young breeding females and heifers joined to deliver a large cohort of calves for the 2022 spring. Females will be well nourished from abundant and good quality pastures promoting favourable growing conditions. While the southern states are accelerating their rebuilds, success in the north will be ongoing, albeit at a slower pace. While Queensland’s rebuild has been aided by excellent spring and summer rainfall events in central and southern parts of the state, the northern pastoral system requires a positive end to the 2022 wet season before its rebuild can definitively begin in 2023," Mr Bignell said.
Increased supply will see slaughter numbers increase by 11% in 2022, with production volumes expected to reach 2.08 million tonnes (+12%), a positive sign for export markets according to Mr Bignell. Production forecast for 2024 foresees a total of 2.44 million tonnes, a 32% improvement on 2021 and a new record for the country.
"Following a challenging 2021 for export markets, Australian beef will enter a significant high-value export market when the Australia-UK Free Trade Agreement comes into effect later this year. As many countries continue to recover from the pandemic, demand for Australian beef is expected to grow in line with improving supply of cattle from the second half of 2022," he added.
Nevertheless, the Australian red meat industry must overcome several challenges regarding transportation, staff shortages and the potential for the Australian dollar to appreciate. "While these challenges remain, the beef industry is experiencing market conditions and confidence never seen before at a producer level. Overall, the industry is in an incredibly positive position and will continue to deliver high value, high quality Australian red meat to both emerging and established global markets," believes Stephen Bignell.
China is expected to increase its beef imports by 10% this year, due to the growing demand for the product in this market. Also, South Korea and Indonesia, two important markets for Aussie beef exporters, have remained very resilient to the current market pressures and COVID-19 related challenges, with both nations expecting to see continued growth in imports of beef.
On the other hand, domestic beef consumption has dropped 11% in 2021 in part due to the disrupted recovery of the foodservice sector in response to new COVID-19 variants. At the same time, retail prices increased by 11% in part due to high cattle prices and limited supply.
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