Cattle ships wait for permits

The cattle industry fears live trade to Indonesia could remain in limbo for an extended period as exporters begin diverting shipments to other markets.

Live cattle exports to Indonesia ground to a halt on July 1 when Jakarta failed to issue import permits for the next three months.

Unless the permits come through today, exporters are bracing for the disruption in the trade to drag on for at least another 10 days as Indonesian authorities go into shutdown mode connected with the end of Ramadan.

Australia Indonesia Business Council (WA) president Phil Turtle said the lengthy delay in issuing the permits was of deep concern.

Cattle that had been earmarked for customers in Indonesia are being diverted to Vietnam, Malaysia and the Philippines, but exporters and producers are worried about flooding those markets and the impact on prices.

Exporters also face significant costs for every day ships are sitting at anchor.

A dispute between Indonesia’s trade and agriculture ministries is being blamed for the permit hold-up. It is understood Trade Minister Rahmet Gobel is concerned about high beef prices, but critics have accused him of making the situation worse by disrupting supply.

Indonesia relies almost exclusively on Australia for external cattle supply and imported 730,257 head last year.

Mr Turtle said the trade disruption had negative impacts for both countries.

“Cattle are one of the major exports underpinning our important and valuable trade relationship,” he said.

“Disruptions like this are not only bad for this sector, but add to the uncertainty of dealing with Indonesia more broadly.

“Adding instability and uncertainty to the supply chain seemingly threatens the security of supply that is so important to our Asia neighbours.”