As the year draws to a close and with record money being paid for Northern Territory cattle, there has been a sudden rush of live export ships out of Darwin Port.
- The live export price for feeder steers to Indonesia has reached a record $4.70/kg
- Darwin Port is experiencing a rush of cattle shipments prior to Christmas
- Indonesia has imported less cattle this year, but has increased imports of boxed meat
There have already been four cattle shipments out of the city this month and another five are due by December 20.
ABC Rural is aware of some feeder steers to Indonesia fetching $4.70 a kilogram, which is a record price for the trade.
“The money is red hot, the demand is there, but cattle numbers are dwindling,” Top End Livestock’s Scott Riggs said.
“Put it this way: it took us 10 properties last week to get 3,000 head of cattle together — so a fair bit of travel just to make it all work.
Nick Vereker from Road Trains Australia said his company was seeing a “flurry of action” before Christmas.
“We’re trying to get as many cattle out of the flood plains before the big rains come, because if you don’t get them out now, you won’t be getting them out until after Easter,” he said.
Mr Vereker said the price being forked out to fill live export boats was incredible.
“You look back 10 years ago, everyone was jumping through hoops for $2.10/kg, now they’re $4.50/kg [and beyond] — it’s pretty hard to believe.”
The live export price has been underpinned by rising domestic cattle prices across Australia.
The industry’s benchmark Eastern Young Cattle Indicator (EYCI) surged to a new record high this week of 1,155c/kg cwt.
Will the price hit $5/kg?
In 2015, the live export price for feeder steers to Indonesia (ex-Darwin) was $2.50/kg.
When industry veteran Ross Ainsworth predicted the price would rise to $4/kg, some thought he was mad.
But he was right — the price reached $4/kg last year and has been above that mark consistently since November 2020.
“There’s rumours now [of $5/kg],” Mr Riggs said.
“The way Queensland is at the moment, if [live export traders] want cattle, maybe we will see $5 … I hope the vendors do get it.
“[Indonesia] wants the cattle, and with Ramadan coming up, they will have to put cattle in their feedlots, so they’ll just have to pay the price.”
Ramadan starts in early April, so Indonesian feedlots traditionally look to stock up months beforehand, giving them the standard 100-120 days of fattening prior to slaughter.
Not all smooth sailing
While record prices are great for the northern cattle producers who are selling, the situation is very tough for Indonesian importers and feedlots.
Other potential ramifications are also starting to emerge.
Live cattle export numbers to Indonesia are well down this year, but data suggests Indonesia has been filling that gap by importing more frozen boxed meat.
Simon Quilty from Global Agritrends, said the value of Indian buffalo meat and Brazilian beef was falling because those two nations had lost access to markets such as China.
He told ABC Rural that those two nations were now targeting markets in South-East Asia, which he felt could have “serious ramifications” for Australia’s live cattle trade.
“When it comes to live cattle, we’ve simply outpriced ourselves in that market,” Mr Quilty said.
“Brazil in the last few months have aggressively stepped into this market [with boxed beef].
“I see this trend continuing in 2022 with cheaper Indian buffalo, cheaper Brazilian beef going into these secondary markets in South-East Asia.
According to Meat and Livestock Australia, the live export industry “is struggling with a range of issues” and is on track to export just over 700,000 head this year — down 30 per cent on last year.