ABARES forecasts five-year historical high for beef price

Beef prices are set to remain historically high over the next five years on the back of strong global demand generated by African swine fever decimating Asian hog stocks. This includes a 7 per cent rise to 538¢/kg carcase weight in 2020-21 as predicted by ABARES’ beef and veal outlook for the March quarter. ABARES economist Jenny Eather said ASF’s ongoing impact on Asia’s pig population, particularly in China, would underpin ongoing demand for Australian beef to plug Asia’s protein shortfall. “High global demand for red meat as a result of the African swine fever outbreak in China and several other Asian countries has led to high beef prices in global markets in the first half of 2019–20,” she said. “Some beef exports to China were disrupted as a result of the COVID-19 outbreak in early 2020.” More than 200 million ASF-infected pigs have died or been killed in China amid the ravaging swine disease outbreak in the past two years. The disease, which is not contagious to humans, is also present in 11 other Asian countries and parts of eastern Europe. Western Beef Association chairman Ken MacLeay said producers had an opportunity to capitalise on the major shortage of animal protein in Asian markets caused by ASF. “Beef has been the beneficiary as Asian consumers look to replace pork,” he said. “Just what effect COVID-19 will have on demand is still a little unclear, however any reduction will most likely be short lived.” Mr MacLeay said on the supply side, producers need to be reminded that there is a long lead time. “Breeding decision that are made today will not come to market for some two or even three years down the track,” he said. “I expect the beef industry to keep producing as normal in the reasonable expectation that COVID-19 will be well behind us in less than one breeding cycle.” Mr MacLeay said the Australian food industry had been committed at all levels to remaining open during the COVID-19 shutdown.