Exporters happy to talk Turkey

Despite Australian cattle exports to Indonesia dropping 36 per cent this year, largely as a result of a month long ban on the trade and a reduction in maximum cattle weights, cattle exports are on the rise globally.

Meat and Livestock Australia (MLA) figures show that in June the US shipped more than 10,000 cattle to Turkey, almost a tenfold increase on the same month last year.

In the first six months of 2011, the US shipped close to 25,000 cattle into Turkey compared with 6600 in the first half of last year.

US cattle exports to Turkey and Russia are mainly made up of dairy cattle with some beef breeders also included.

Analysts are suggesting the weak American dollar is making US cattle much more competitive in price and has led to the big increase in numbers.

Wellard Rural Exports has been working out of the US in recent months using its largest purpose-built livestock vessel, the MV Ocean Drover, which is capable of carrying 18,000 head of cattle or 75,000 sheep.

Wellard managing director Steve Meerwald said the Ocean Drover left Australia in late April with a cargo destined to Russia and had since been working between the US, Turkey and Russia.

He said the Ocean Drover had just loaded its second cargo of breeding cattle, destined for Turkey, in the north-east US with the vessel scheduled to return to southern states to load more cattle destined for Russia.

The Ocean Drover will return to Australia with a second ship, the Ocean Atlantic, scheduled to first deliver Australian cattle to Russia in eight weeks and then service the US breeder cattle market.

“We are seeing considerable interest in livestock from North America, ” Mr Meerwald said.

“This is being fostered by the weak US dollar and high Australian dollar in comparison, ” Mr Meerwald said.

“So far we have shipped mainly Holstein Friesians and some beef breeders from the US.”

Mr Meerwald said Australia was in direct competition with the US when it came to breeder cattle for the Russian and Turkey markets; however, availability of joined Holstein Friesian heifers from Australia had been low due to the majority of these cattle already being exported to China.

He said Wellard hadn’t even gone down the path of considering shipping feeder or slaughter cattle from the US into Middle Eastern or Asian markets because the economics simply didn’t work with higher cattle prices and the cost of sea freight on such a long voyage.

Mr Meerwald said that while Wellard was still aiming to ship between 80,000 to 100,000 head of cattle from Australia to Indonesia before December this would be influenced by availability. The positioning of Wellard livestock vessels meant it also had the ability to affect shipments to Indonesia.

“We position our ships where we see the most value to our business; this depends on demand from importers and availability of stock, ” Mr Meerwald said.

All Wellard livestock ships are multipurpose and the vessels servicing the US have in the past serviced Indonesia.

“Whether we have one or two vessels operating out of the States, capacity does get restricted with fewer ships available to service Australia, ” Mr Meerwald said.

“We have just been through some very difficult times over the past 12 to 18 months in Australia, both in sourcing sheep and with weight restrictions coming into effect in Indonesia, followed by the ban on this trade and getting it back up and running.

“Wellard has always had the view it should be operating in other markets.”

Mr Meerwald said the ban on exports to Indonesia during June has cost the company about $5 million.

But he said at this stage Wellard was not pursuing legal action over its losses.

Wellard also has the Ocean Shearer loading out of Townsville and Darwin this week with cattle destined for Indonesia and it is loading the Ocean Outback in Darwin with cattle for Egypt as well as the Ocean Swagman, which is loading at Darwin with cattle destined for the Philippines.