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Beef Report


Insider market intelligence for those who live outside



WEIGHT (RP10,970 = $1AUD)

Darwin’s feeder steer prices have hit a new all-time high with the rate sitting at $4.30kg live weight with prices as high as $4.40 reported for small numbers.

 If these high prices weren’t causing enough pain for exporters, the Australian Government has just announced a possible price rise for export fees and charges of over 400 percent over a three-year period from July 2021.

Exporters hope to negotiate a range of administrative efficiencies, which will assist to reduce the level of charges levied by the Government. The problem that exporters face is that some of the bureaucrats they are negotiating with will potentially lose their jobs if they cooperate and make the export certification system more efficient. Good luck with that.

Meanwhile, slaughter steer prices continue their steady climb with my indicator rate rising from Rp46,500kg live last month to Rp48,000. This figure was produced from a range of reported rates from as low as Rp46kg in Lampung to as high as Rp49,000 in Java. Despite this increase in live slaughter cattle prices, the rates for fresh beef in the wet market remains steady at Rp130,000 per kg. In contrast, supermarket rates in Jakarta are discounted in two of the major chains with fresh knuckle down from the usual price of about Rp160,000kg to Rp129,000. Even Australian imported knuckle was discounted to Rp139,000kg in the Giant supermarket chain.

Frozen Indian buffalo meat has gone in the opposite direction with a new supermarket rate of Rp95,000kg, an increase of more than 18 percent since January. 

Bulog, the state Logistics agency, has been given the task of importing 80,000 tonnes of Indian buffalo meat to ensure adequate supplies of beef are available for the festivals of Ramadan, Lebaran and Qurban, with the first day of Ramadan on the 12 April. A spokesman for the agency said that the imports would be conducted in stages in accordance with the market demand to stabilise the price without harming local farmers.

Proposals for alternative live cattle imports from Mexico don’t appear to have make any significant progress with new reports that Brazil might be a more cost-effective source, although their foot and mouth disease disease status is way below that of Mexico, so the risks associated with a Brazilian shipment would be much greater than one sourced from Mexico.

Buffalo imports have increased dramatically during 2020 compared with the previous year as lot feeders try to reduce the overall cost of their imported stock. The total rose from 3377 head in 2019 to 6252 during 2020.

So why import live buffalo when it is possible to buy much cheaper frozen Indian buffalo meat? The simple answer is that fresh buffalo meat from locally slaughtered animals is a totally different product to frozen Indian buffalo as these animals are culled for advanced age from the Indian dairy herd and in most cases lose a great deal of weight between the time they are culled and slaughtered. By contrast, local or imported buffalo are fed up to maximise their slaughter weight and meat quality before slaughter in Indonesia. It is also well known that fresh meat has superior eating qualities to the frozen product.



(VND18,020 TO $1AUD)

Buffalo exports from Darwin to Vietnam have continued at a steady rate with 3825 shipped in 2019 and 3994 sent during 2020. This places Vietnam as the second biggest importer of live Australian buffalo with Indonesia the largest receiving 6252 in 2020. Buffalo are generally caught in the wild and held in yards for extended periods while they are acclimatised to close handling, dehorned and processed for export. The market price for buffalo is cheaper than cattle, although there are a number of additional costs associated with the shipments, including additional space requirements on ships that increase their landed costs in the importing country. 

The Rum Jungle abattoir south of Darwin plans to kill up to 420 buffalo per week or around 16-17,000 during the 2021 season. Northern Territory buffalo producers and harvesters are fortunate to have multiple sale options, including live export (feeder and slaughter weights), local slaughter and retention of younger females for domestication programs.

Meanwhile, slaughter for steers rates have stabilised. The indicator price per kg live weight remains at Dong81,000 although the AUD conversion above has changed slightly due to the appreciation of the Aussie currency.

While Vietnamese importers are under pressure, the longer-term view of the market is positive with Vietnam delivering one of the best economic performances during the covid year of 2020. See the table below showing Vietnam leading the region with a 2020 GDP growth of 2.9 percent, while the majority of Asian economies produced a negative result. Analysts have predicted Vietnamese GDP growth for 2021 of 6-9 percent which would almost certainly maintain its position of the fastest-growing economy in Asia. Factors noted for this optimistic view include the extremely effective management of the covid pandemic along with a continued migration of manufacturing industries out of China and into Vietnam. The important tourism industry is also expected to recover later in 2021.

Despite this optimistic view of the Vietnamese economy there are still plenty of serious issues facing the domestic food-producing industries. The African swine fever (ASF) epidemic has resulted in a large illegal trade selling Vietnamese pigs across the border into China where prices are almost double local rates. This has the potential of seriously reducing supplies in the north of the country and driving up prices further.

H5N6 Avian Influenza has been reported in a Quang Minh commune in North Vietnam, while the outbreak of lumpy skin disease, which commenced in cattle in the Loc Ha district, is still spreading to other districts despite the government’s control measures.

This is the first time that this report has been translated into Vietnamese. The translation has been kindly funded by the Northern Territory Buffalo Industry Council. TQ