Forum highlights Indonesia’s growing market value

Beef Central, 06/03/2014

Indonesia is on track to take its place as Australia's third most important market in total beef export volume terms, industry  leaders meeting at the 4th Northern Beef Roundtable and Producer Forum in Broome, WA last Friday and Saturday were told.

The forum received an upbeat overview of strong Indonesian demand both for live cattle and boxed beef from Meat & Livestock Australia's manager for Indonesia John Ackerman.

Mr Ackerman said Indonesia's economy was growing strongly, consumer confidence was on a high and demand for beef was soaring in all sectors, particularly the restaurant trade.

He predicted Indonesia could become as important a beef market for Australia as China, even Korea.

See Beef Central's January 21 article How Indonesia is steaking a bigger export claim 

This upbeat assessment followed Federal Agriculture Minister Barnaby Joyce's welcome of the 240 delegates to the new Broome Civic Centre, in which he pledged to be a servant of producers and industry – to get the beef trade with Indonesia back on track after the disaster of the then federal Labor government's decision to suspend the live trade in 2011.

Minister Joyce said northern Australia was closer to Indonesia and other near-SE Asian markets with hundreds of millions of consumers than the population centres of southeast Australia with less than 20 million. The links were obvious and historic.

Deputy-chairman for Investment Promotion with the Indonesian Investment Coordinating Board Mr Himawan Hariyoga said his country was looking to invest in beef supply from Australia – both directly and in joint ventures. While there were challenges to doing business with Indonesia, he urged industry to persevere in developing strong, long-term relationships.

National Australia Bank' chief representative in Indonesia Dean Horton said beef consumption in Indonesia was headed strongly up from the current 2kg/year per capita and this offered tremendous two-way investment opportunities.

Indonesia was looking for food security and importantly reliability of suppliers and price stability.
For northern beef producers and the broader industry, this meant opportunities for investment in breeding properties in Australia, investment and joint-ventures in vertically-integrated feedlots and abattoirs and supply chains in Indonesia.
Indonesian investors included existing food supply companies, professionally managed funds and wealthy individuals – sophisticated investors looking for opportunities and diversity.

Western Australia Department of Agriculture and Food director-general Rob Delane said it was tremendous to have four agriculture ministers – Federal Minister Joyce, WA Minister Ken Baston,  NT Minister Westra van Holthe and Qld Minister John McVeigh – at the Broome Beef Roundtable.

The attendance of the four Ministers underlined the importance now being placed on the development of the northern beef industry. Mr Delane said the four governments were working cooperatively to double the value of the beef industry across northern Australia.

Beef industry icon David Crombie said the outlook was good: "We've got $2.30 (a kilogram for boat trade) and a wet season (in northern WA) – it's not often you get that quinella," he said.
Putting his AACo board jersey on, Mr Crombie said the company's Darwin abattoir was on track – expected to produce its first box of beef in August – and his view was that the plant would focus on processing older cattle.

"My view is that younger cattle should go on boats, because they travel better …older cattle go in boxes," Mr Crombie said.

All speakers agreed the industry had a great story to tell. Entrepreneur and advertising agency head Harold Mitchell said the next century offered wonderful opportunities for Australia in Asia – which accounted for half the world's economy and a huge growing market for food products.

Mr Mitchell, who has substantial personal investment in the northern beef industry with stations covering 800,000ha in the Kimberley, said the industry had faced enormous challenges, but now was not the time to panic because the future was very good.
"This will be our century," he said.

Queensland Agriculture Minister John McVeigh told the forum it was heartening to be one of four, like-minded Ministers focused on doing all they could to work with all sectors to develop the northern beef industry.

"We all need to move on from what went wrong under the former government. We do need to move on and be involved in mapping the future for this great industry."

Source: Office of Queensland Minister for Agriculture John McVeigh


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