INDONESIA SLAUGHTER STEERS $5.19KG LIVE WEIGHT (RP10,600 = $1AUD)
The cattle markets in Indonesia are understandably in turmoil as a result of the rapidly spreading foot and mouth disease epidemic. I expect that by the time this report is published the price at the feedlot will be in rapid decline. Prices in the FMD infected areas of the domestic cattle population are reported to be down to as low as Rp15,000kg live weight as panic has set in all along the supply chain from producers to abattoirs to government agencies to meat traders and the consuming public.
Indonesia is now in the most dangerous phase of the epidemic, which is the time between the emergence of the disease across the country in a herd with zero immunity and the delivery of suitable vaccines to a majority of the cattle population (and sheep, goats, buffalo, pigs and Bali cattle). FMD vaccines are extremely effective in controlling the disease and preventing clinical signs, so once the vaccines are administered to the bulk of the population, the animal production losses are minimal and the strategy is then changed to eradication where the costs tend to be on the government side more than industry.
During this period with rapidly spreading infection and no vaccine, the costs to the industry will be staggering. The value of animals plummets as panic selling sets in. Movement of livestock becomes heavily restricted with animal health agencies, the police and even the army often operating on different sets of regulations, creating confusion and disruption to the flow of animals to slaughter facilities. Cattle owners with healthy fat stock want to get them slaughtered before they become infected (and potentially worthless), but abattoirs are overwhelmed by emergency slaughter of infected stock. Emergency slaughter will also be taking place on farms where animals are unable to be moved to abattoirs with these additional meat supplies being delivered to already oversupplied retail wet markets.
A significant proportion of smallholders stand to lose one of their “average” of two cows each, which represents a massive reduction in their personal wealth as the cows are often as valuable as the farmer’s house. Large lot feeders are in a similar position but just on a much larger scale. Elsewhere in the world when unvaccinated animals are infected about 30 percent of the herd can be clinically affected with foot and mouth lesions. This generally means that they stop eating, have difficulty walking and must lay down on their side to reduce the pain in their feet. Feeders weighing 300kg will have a fair chance of recovery, but with heavy animals, infection usually leads to recumbency, rapid weight loss, pressure sores and secondary infections, including pneumonia. As these large, heavy animals are reluctant to walk even a few metres to the water trough, they are not in a position to be trucked to the abattoir. Imagine a feedlot with 30 percent of 1000 head of heavy ox laying on their side, unable or unwilling to stand.
I am not trying to be an alarmist or to overstate the risks involved, but the only chance for a quick resolution of this epidemic is the rapid application of appropriate vaccines. And from the information I am getting, it appears that the government is in no hurry for vaccine importation and distribution.
Some of the information coming from a number of industry and government sources is suggesting that the clinical signs of the FMD are mild and that
an uneventful recovery is the most common outcome of infection.
This appears to relate to the fact that the average body weight of a large proportion of domestic beef cattle is relatively low. Mature cows will average about 330 kg with mature bulls at about 400kg. The smaller the animal, the less weight on their foot lesions and less damage to claws. This improves the chances that the claws don’t detach, which then increases the likelihood of a slow but successful recovery. Heavy cattle are not so fortunate as the damage and pain in their feet is much greater leading to a much poorer outcome. This heavy category also includes large Friesian/ Holstein dairy cows, which often have body weights of 400-500kg. These cows also suffer a very poor outcome as per heavy beef cattle.
A further complication is that the Muslim festival of Qurban is due to take place on 9 July when cattle, buffalo, sheep and goats are slaughtered with the meat being distributed to the poor. The numbers of animals slaughtered are huge with estimates across the nation of more than 200,000 cattle and more than one million sheep and goats. This means that a very large number of stock will need to move from their farms to the place of slaughter, which in the majority of cases will be near large population centres. The increased potential for the spread of disease is obvious. In addition, the Indonesian Ulema Council has issued a fatwa (religious stipulation), which includes a statement that animals with mild FMD symptoms are acceptable for sacrifice while those with severe symptoms are not. Plenty of scope for further confusion and misinterpretation.
As a result of FMD not being present in the country for about 40 years there is little knowledge in the public domain regarding the appropriate management of the disease and the safety of the meat from infected animals. The science is clear: infected animals present zero risk to human health but, unfortunately, many people have already expressed their opposition to eating the meat following the spread of ill-informed rumours on social media of humans contracting the disease from beef consumption.
DARWIN FEEDER STEER
Prices remained at the $4.80 mark with feeder heifers selling for $4.60. During May, 22,750 head were exported from Darwin to Indonesia. I am predicting that demand will fall dramatically as importers assess the risk of any new shipments becoming infected with FMD and do the sums on their potential losses. I also predict that this slowdown in demand will only last as long as vaccine is unavailable. As soon as adequate supplies of vaccine are waiting in the feedlot fridge to protect all the incoming feeders then it will once again be business as usual. This is the case in Vietnam where FMD is endemic and our cattle are constantly exposed but are routinely vaccinated within 24 hours of arrival with a second shot one week later. In fact, considering the probable decimation of the domestic herd through the combined effects of FMD and lumpy skin disease, I expect that demand for feeders will increase significantly to fill the gap left by large losses in the national herd. Remember that while LSD is a disease of cattle and buffalo only, FMD also affects sheep, goats and pigs so its impact on the full range of red meat supplies will be much greater.