Red meat surge to continue

Rueben HaleThe West Australian

Demand is set to outstrip supply as Australia expects to continue to ride the red meat boom.

Meat and Livestock Australia market information manager Ben Thomas said it had been an "extraordinary" year for beef and lamb, coming from the strength of the boxed beef export market.

This year about nine million cattle, 22 million lambs and 9.5 million sheep were slaughtered in domestic abattoirs.

In addition to record slaughter levels, rapid growth continued in live exports, with about two million sheep and more than one million cattle shipped overseas.

"Australia exported almost 1.3 million tonnes of beef and 237,000 tonnes of lamb, which were both records," Mr Thomas said.

"Live cattle exports are expected to continue to break records next year and sheep is expected to continue strong."

Mr Thomas said the recent spate of free trade agreements with Korea, Japan and China, as well as continued strong demand for red meat in Indonesia and Vietnam will keep prices high but supply is expected to slow.

"These agreements will set-out a reduction of tariffs over period of time and make Australian products more competitive over time on the international markets," he said

"Demand for protein from these regions is growing and it's now the second year we've broken lamb records and the third year for beef.

"But we're expecting a slowdown not because of waning demand but more over a tightening of supplies as Australian farmers enter a restocking phase."

WAMMCO and Southern Meats chief executive Col McRury said lamb prices have come down from the high of last year, since the new season lambs.

"The last six months and the first part of this season prices have softened," he said.

"And the skins market is only returning about 40 per cent of what it was returning 18 months ago," he said.

Mr McRury said while he remained optimistic about the lamb industry in the future, world markets were having some negative impacts in the immediate future.

"The Chinese market has softened and the US has become a dumping ground for frozen lamb," he said.

"Under these conditions you tend to become price takers.

"So it's going to be a tough next 12 months but we're still confident about high returns looking forward. The positive future for WA sheep producers is that competition from New Zealand will decline over time because it will never be able to rebuild its heard to the size it was in the 1980s."

Elders livestock manager Tom Marron said the strong support of cattle was underpinned by strong growth in the Vietnamese live export trade. "This trade creates more competition for processors to compete, which is good for the industry," he said.

"Demand is expected to remain strong this year like last year where we're seeing about $700 for all types of cattle, so producers need to focus on bolstering current and future stocks."

Meanwhile, Eastern State demand for WA free range pork has painted a rosy outlook for local producers.

Craig Mostyn Group executive director Andrew Moystn said a 20 per cent increase in last year's volumes is forecast.

"This is great news for our local producers," he said.

Mr Mostyn also said export demand for Australian pork remained strong.

"Hopefully China will bolster this market in three to five years with the tariff reductions," he said.

"Now the industry needs to work towards implementing supply protocols with China because the demand from their 5-star restaurant market in the future could be significant."

However the national pork outlook, which accounts for 96 per cent of the total market, is showing a more modest increase for the coming year.

Australian Pork Limited chief officer Andrew Spencer said WA was ahead of other States.

2014 price rises *

Average WA-specific prices for beef and lamb to December 18, 2014. *

·Pastoral cows: 155c/kg lwt, a rise of 45c/kg from the same time in 2013 (110c/kg lwt).

·Feeder yearlings: 222c/kg lwt, a rise of 51c/kg from 12 months prior (171c/kg lwt).

·WA trade lambs: average of 493c/kg cwt, up 31c/kg year-on-year (462c/kg cwt).

·Mutton: 283c/kg cwt, up 91c/kg year-on-year (192c/kg cwt).

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