Middle East looking for other suppliers: Balzarini

Melissa WilliamsCountryman

Several of Australia's live export markets in the Middle East are seeking new livestock suppliers as a result of regulations being imposed on them by the Export Supply Chain Assurance System (ESCAS).

Wellard Group managing director and executive chairman Mauro Balzarini told the Pastoralists and Graziers Association annual convention last week that Turkey, Saudi Arabia and Bahrain appeared to have initiated new trade agreements with alternative suppliers in recent weeks.

He said Turkey was understood to have signed a health protocol with Brazil and was preparing to take 30,000 bulls from that country.

"This is the first livestock shipment we know of from Brazil to Turkey," he said.

"But with a health protocol signed, there is likely to be more trade between the two countries."

Mr Balzarini said some livestock importers in Turkey were content with Australia's ESCAS but many could not meet the requirements of the system due to financial constraints and other difficulties.

He said he had heard Bahrain was seeking sheep from Saudi Arabia and had taken cattle from Brazil last week.

This came as the country was effectively being cut out of the Australian trade after rejecting a sheep shipment last month on the grounds that it believed some animals had scabby mouth.

"I think if we put in a request (to the Federal Government) to export to Bahrain, it would be rejected," Mr Balzarini said. "It is up to the Australian Government before the Bahrain market opens again."

Mr Balzarini said Saudi Arabia had also reportedly signed an agreement with Brazil last week to take livestock from that country.

"Since Australia has introduced new export requirements (through ESCAS), the trade has started to move elsewhere and many of our markets are getting stock from other countries," he said.

"We have heard reports that one vessel from Brazil lost 3500 animals during a journey and another from the US lost 10-15 per cent of its livestock cargo.

"All of this is a consequence of removing live exports from Australia.

"Are the animal welfare groups in Australia sure that banning live exports from Australia will improve animal welfare outcomes?"

Mr Balzarini said he supported ESCAS but was uncertain that such a prescriptive approach was the best way for Australia to proceed in offshore markets.

"We can improve animal welfare outcomes but we also need to allow our customers to operate as they choose," he said.

For Wellard, it would be business as usual for live shipping into its main Middle Eastern markets in coming months and few hold-ups were expected from the introduction of new protocols for export permits announced last week.

The company had a sheep shipment leave Fremantle in the middle of last week bound for the Middle East.

This was one of three consignments to receive export permit approval from the Federal Government. Another shipment from Livestock Shipping Services was understood to have left Fremantle last weekend and the third, from Emanuel Exports, was imminent.

Wellard is also continuing to develop its own ESCAS-approved infrastructure in Saudi Arabia to feedlot sheep shipped from Australia.

This will be the company's first offshore sheep feedlotting facility, complementing its cattle breeding operations in Indonesia and the Philippines where it plans to expand from 2000 head to 10,000-15,000 head capacity by 2017.

Mr Balzarini said it was hoped the company's Saudi sheep facility would be operational within the next six to eight months and it would have capacity to handle imports of 350,000 to 400,000 head per annum.

"It may become our second or third biggest market for Australian sheep after Qatar," he said.

Middle Eastern markets would also be the focus for processed meat through the company's recent acquisition of the Macri family's Beaufort River Meats in the Great Southern.

The purchase of the abattoir, which has slaughter capacity of 2500 head per day, complemented the company's live export operations and was not a loss of faith in the future of the industry.

"It represents a small fraction of the investments that we have in shipping and logistics, which is the biggest proportion of our overall operation and provides about $380 million of our annual turnover," Mr Balzarini said.

"We have two new livestock ships in the pipeline due for commissioning next year and in 2014, which will replace older vessels and give us some extra carrying capacity.

"But we will now be able to service markets that we are already servicing with the live trade throughout the world with processed and chilled meat as well."

Wellard plans to process lamb and mutton through Beaufort River Meats when the plant opens this month after its annual winter shutdown and will retain the services of the Macri family to manage the facility.

Mr Balzarini said that the company's sheep buyers were looking for live shippers and would now be able to offer producers an alternative market for a wider range of their stock.

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