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Cattle forum and $60m to boost red meat trade with Indonesia

by Beef Central, 07 July 2013

Prime Minister Kevin Rudd and Indonesian President Susilo Bambang Yudhoyono have announced during the annual Australia-Indonesia Leaders’ Meeting in Bogor the establishment of an Indonesia-Australia Red Meat and Cattle Forum.

In a press released distributed to media on Friday, the Prime Minister also announced a $60 million funding package, to be provided over 10 years, for increasing agricultural cooperation and boosting investment in the red meat agribusiness sector in Indonesia.

The statement said the Forum will comprise a broad range of representatives from the beef and cattle industry, including well recognised and established industry figures and senior government officials.

It was also aimed to enhance engagement between the Australian and Indonesian beef industries and the governments of both countries, and to improve prospects for long-term trade and investment in beef in Indonesia.

"To capitalise on the opportunities for agricultural cooperation and investment, the Forum will recommend activities to build the meat supply chain and encourage greater Australian investment in Indonesia," the Prime Minister's statement said.

"The $60 million package will be available to kick start these activities, which would benefit both Australian and Indonesian consumers and producers."

Industry awaiting detail

Australian cattle industry representatives say they are still waiting to see more detail about the scheme.

Australian Livestock Exporters Council chief executive officer Alison Penfold said the announcement appeared to be very similar to a proposal the Australian industry had proposed in the development of the Indonesian Market Access Strategy. 

"We welcome efforts to boost cooperation and enhance dialogue but we urgently need runs on the board," Ms Penfold said.

The newfound attention being devoted to the Australian-Indonesian cattle trade by the political leaders of both countries has contributed to hopes in Australia's export cattle industry that Indonesia may be poised to relax restructions on import quantities and/or cattle weights. 

The Indonesian president Susilo Bambang Yudhoyono told the media during Australian Prime Minister Kevin Rudd's visit that beef shortages in Indonesia would increase as the country's consuming class grew, and there was "need for greater co-operation in the field of trade of beef".

Echoing the same sentiment expressed by Indonesian ambassador to Australia Nadjib Riphat Kesoema during a visit to Queensland's Gulf Country last week, the president called for Australian companies to invest in grazing land and cattle industry infrastructure in Indonesia. 

Mr Kesoema last week said that as part of Indonesia's desire to build a more secure supply of beef, which was impacted by Australia's 2011 ban on live cattle exports to the country, Indonesian state-owned enterprises were also likely to buy cattle properties in northern Australia. 

Turning a 'lose-lose' into a 'win-win'

Ross Taylor, the chair of the Indonesia Institue, a Western-Australian based non-Government organisation which focuses on Indonesian-Australian relations, said Australian farmers should not fear requests to assist Indonesia to improve its own cattle herd. 

"In fact the reverse applies, as we should be using our world-first expertise in farm and water managment, agronomy, nutritional sciences and marketing to build partnerships throughout the entire food chain complemented by Indonesia's almost perfect soils, abbundant rainfall, plentiful labour and access to regional markets. 

"Together we should, and can be, exporting added value food products through Indonesia to many third-party countries.

"We believe this is a good move for both Australia and Indonesia and will only help rebuild trust and co-operation with the entire agriculture sector between our two countries.

"With Australian cattle stations facing devastation and, simultaneously, Indonesians facing meat shortages and price increases of 100pc, there is a mutual benefit in getting this 'crazy'  lose-lose situation resolved.

"The only impediment has been the forthcoming elections in both countries which has dampened the desire to actively progress this critical issue, however these high level talks have now partly addressed this obstacle."

Mr. Taylor said that both governments now had the opportunity to put the mistakes of the past on both sides behind them and to move quickly to facilitate 'partnership' arrangements whereby two-way investment in the supply chain will see the Australian cattle industry not only recovering but, with careful planning, increasing in its size and value.
 

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