The importance of Indonesia as a long-term trading partner for the Australian boxed beef and live export trades has been recognised through important changes within industry operations announced this week.
Meat and Livestock Australia managing director Scott Hansen confirmed this morning that the Indonesian market has been elevated to separate ‘region’ management status within MLA’s operational activity, after being managed previously along with numerous other customer countries under the wing of MLA’s Southeast Asia/Chinas region.
The move is in clear recognition of the long-term potential growth in beef and livestock trade with our nearest northern neighbour, despite current political and access challenges.
It comes as a result of the current trade access difficulties into Indonesia for both live exports and boxed beef, following the 2011 livex market closure over animal cruelty claims, and the subsequent launch of the Indonesian Government’s self-sufficiency drive which has led to savage reductions in import quotas in both Australian beef and live cattle.
Rapidly improving standards of living, an exploding population currently approaching 250 million, and a clear appetite for beef makes it imperative that Australia takes a long-term approach to cultivating trade relationships with Indonesia through both government and industry stakeholder channels.
Dr John Ackerman, previously MLA’s ‘country’ manager for Indonesia, covering both beef and live exports, has been promoted to fill the new regional management role.
“We felt it was the right time, and right opportunity to pay due recognition to the value of Indonesia as a trading partner by elevating it as a market worthy of ‘region’ management significance, in its own right,” Mr Hansen said.
Mirroring the MLA regional management changes, a new industry taskforce has been established, dedicated solely to the Indonesian market. Previously Indonesia was serviced from within the industry’s broader Southeast Asian taskforce. The new group will be chaired by Brisbane processor David Foote, chief executive of Australian Country Choice.
A unique aspect of the new Indonesian taskforce, as opposed to others servicing regions like Japan, Korea, the US, domestic and EU, is that it will involve stakeholders from both the live export and boxed beef export channels.
The new taskforce is designed to provide a “unified and united industry voice to work-in with government and other agencies, in terms of relationship-building between Australia and Indonesia,” Mr Hansen said.
“Many of the market-specific issues are common across both live export and beef export platforms servicing the market,” he said.
Part of that process would involve embracing the Indonesia/Australia Comprehensive Economic Partnership Agreement – a new relationship and trade agreement being developed between the two countries. Discussions on the agreement started towards the end of 2012, off the back of the Federal Government’s Asian Century White Paper.
“We think it’s important for Australian agriculture, and the meat and livestock sector in particular, to work hard on building those relationships,” Mr Hansen said.
“We have a goal of being viewed by Indonesia as a reliable supplier of quality red meat and livestock products, and with that goes the goal of being viewed as a valued partner, generally, to Indonesia. Both sides are equally important to each other: it really needs to be a partnership relationship,” he said.
The taskforce would also work closely with the Australian Centre for International Agricultural Research (ACIAR) body, which among other activities is responsible for oversight of the Federal Government’s $20 million Indonesian beef project, launched last year under the chairmanship of David Crombie.
“Not only are we working towards a combined and unified front within our sector, but we’re making sure we’re working closely with government, through the departments of Foreign Affairs and Trade, and Agriculture, as well as agencies like ACIAR to make sure there is a collaborative effort,” Mr Hansen said.
“That collaboration is firstly about making sure we are hearing and understanding what it is that Indonesia is looking for out of the relationship, and then responding with the kind of actions and dialogue that backs-up our view that we are a valued supply partner for Indonesia.”
At its peak in 2009, Indonesia took more than 50,000 tonnes of Australian beef, while live cattle exports peaked at 773,000 head the same year. When calculated on a boneless beef equivalent basis, the combined beef/cattle shipments that year meant Indonesia was Australia’s third largest export market, exceeded only by Japan and the US.
The newly-formed Indonesian Taskforce will hold its inaugural meeting later this week, during the annual round of industry taskforce meetings being held in Brisbane.
Taskforces for Japan, Korea, the US, EU, Middle East, domestic, southeast Asia/China and now Indonesia will meet during workshops on Thursday and Friday.
New approach to taskforces
This year represents a departure in the way the industry taskforce process operates.
In past years, each group has met in March to discuss marketing strategies in their respective customer countries, but there has been a growing feeling that that process came too late to have any real influence on marketing plans already in train, and due to be activated only three months later, at the start of the new fiscal year.
As a result, the taskforce consultation process with MLA now begins much earlier, in December, and incorporates a greater number of industry stakeholders. This week’s meetings represent the final stage of that process, with sign-off with MLA’s regional managers.
- Details from the Taskforce meetings on Beef Central later this week.