Australia faces uncertainty over Indonesia exports
The first live cattle consignment of 2012 left the port of Darwin in the Northern Territory last week, following an announcement by the Indonesian government that permits for just 60,000 head of Australian cattle had been issued for the first quarter of the year – which is estimated to be 40,000 less than in the same period in 2011.
The low figure is a result of the Indonesian government’s decision in December to slash the amount of live cattle it is to import from Australia from around 510,000 to 283,000 head per year.
The news came six months after the Minister for Agriculture, Fisheries and Forestry Senator Joe Ludwig ordered a complete ban on live exports to Indonesia in June 2011, shortly after graphic footage of Indonesian abattoirs was aired on the ABC’s Four Corners television program. The ban was lifted in July 2011, after the Australian government issued revised export control orders.
While the full reason behind Indonesia’s decision to half the number of live imports from Australia remains unclear, the country has expressed its ambition to become more self-sufficient in food production and this is thought to be a move towards achieving that goal.
Australian cattle farmers have now been left to manage the impact of the cuts and are facing a somewhat uncertain year ahead.
Grant Maudsley, cattle president of AgForce, which represents Queensland’s rural producers, said the Indonesian government’s decision to reduce the export quota had left graziers nervous.
“Obviously people are quite nervous about what will happen, but it is going to be a case of waiting and seeing,” he said.
“We’ve had some cases in the past where the permits have been reviewed by Indonesia and if that happens again then producers will be ready and willing to go with livestock.”
Queensland producers would normally supply around 100,000 head of cattle for export to Indonesia, but that quantity has now been reduced to around 50-60,000.
However, Maudsley said that in spite of the sharp cuts, farmers remained resilient. “Farmers have had forewarning and so they will be making plans to manage the impact.
“Producers are going to be looking at other markets opening and they will also be looking at moving some cattle down to the southern areas of Queensland to fatten. Cattle prices are not too bad at the moment and there is opportunity to move livestock to fattening areas.
“The reality is that we are in this export industry for the long haul, we don’t just drop in and out of it, so we will continue to find more export markets and more box beef markets as the year goes on. And if Indonesia experiences a shortfall in beef, then we will be ready to go.”
AgForce is urging the Australian government to maintain close communication with Indonesia in a bid to protect the interests of Australian cattle producers and the $1 billion live export trade.
Meanwhile, The Northern Territory Livestock Exporters’ Association is also hopeful that Indonesia will increase the number of live cattle permits it issues to Australia throughout 2012, as a result of system changes put in place by both countries.