Trade

US, EU only highlights in flat January exports

Jon Condon, 03/02/2012

 

Strong growth in trade to the US and the European Union was one of the few highlights in Australian beef export performance during January.

Total offshore trade for the first month of the new calendar reached 47,168 tonnes, a decline of  40 percent on December’s very strong performance of 82,000t, according to trade data released by DAFF yesterday.

The January figure was about 12pc better than January trade last year, but it must be remembered that export activity in the opening weeks of 2011 was greatly hampered by flooding in Central and southern Queensland and across NSW.

The Port of Brisbane, for example – easily Australia’s largest departure point for beef exports – remained closed to all shipping traffic for a week at the height of the flood drama, and operated at reduced capacity for some time afterwards.

Exports to Japan for January reflected the current flat demand being experienced in North Asia generally, reaching 16,799t. That was down from 30,200t in December, but was on par with exports in January last year of 16,742t.

The slow start in trade to Japan for the year continues the trend from 2011, which proved to be Australia's lowest export volume year to the market since 2003.

While typically a slower trading month forAustralia’s third largest export market, January shipments to South Korea also looked flat, totalling 6722t, only about 23pc of which was chilled beef. December’s figure was almost double that at 12,400t, while trade this time last year reached 7708t.

Given recent uncertainly over beef import permits, it was little surprise to see January trade to Indonesia reach only 1664t, little more than half of total trade to the market seen in January last year. 

Exports to EU jump 64pc

Once again, it was a basket of smaller and emerging international beef markets, plus some resurgent trade to the US that provided the backbone for Australia’s overall export trade last month.       

Trade to the European Union started 2012 on a positive note, with shipments totalling 520t, an increase of 64pc on the same period last year. Highlighting the fast start to the year, EU exports for January were also 123pc above the five-year average and represented the highest January total since 1999.

However, volumes were back almost half compared to the previous month, with December 2011 volumes reaching 1098t. Contributing to the decline in shipments from December was the reduced availability of product, with many processors undertaking annual closures throughout January.

In contrast to the EU, exports to the former Soviet States, namely Russia, started 2012 on a slower note, totalling 1215t for January, back 57pc year-on-year.

Exports to that market will likely accelerate once there is more clarity about the quota allocations and the WTO deal has been approved. It remains to be seen if new TRQ amounts will be announced once the Russian WTO accession has been ratified.

An increase in Australian exports to the US during January may have impacted the available supply of manufacturing beef for the month, resulting in the decline to the CIS, which takes similar product.

Exports to the US in January totalled 11,774t, a 97pc increase year-on-year, as strong US demand driven by recent herd declines and the end to cow liquidation following drought pushed imported manufacturing prices to historically high levels (see this morning’s separate story "Strong growth in US trade – but will it last?")

The strong start to the year in trade to the US follows solid shipments in December, which reached 15,900t, close to double the volume seen in December a year earlier.

The recent monthly numbers suggest the US may again be re-asserting itself as a major customer for Australian grinding beef, after a 2011 year which proved to be the lowest, by volume, in more than 20 years at just 167,000t. 

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