Slow down in China’s beef demand hits key suppliers

China’s beef imports are dwindling amid slowing consumption and ample domestic supply, dealing a blow to its biggest supplier, Brazil.

Official data shows the value of China beef imports fell last year for the first time since at least 2016, with prices plunging to the lowest level in almost three years. Import volumes are expected to fall 4pc this year, ending 12 straight years of meteoric rise, according to the US Department of Agriculture.

The predicament highlights the risks in relying heavily on a single customer: China was the destination for more than 52pc of the South American country’s beef sales last year even after halting imports for roughly two months over a case of mad cow disease. While the nation’s meatpackers have sought to diversify their exports, alternatives remain limited.

“Brazil depends a lot on China – if there’s a hiccup in China, it will affect Brazil very badly,” said XP Investimentos analyst Leonardo Alencar.

China’s share in the global meat trade has plunged from a 2020 peak following an increase in domestic meat supplies. The nation is expected to produce 7.7 million metric tons this year, up 1 million tons from 2020, according to the USDA. An economic slowdown has prompted consumers to seek cheaper proteins.

Clarice Couto and Gerson Freitas | Irish Independent

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Australian meat exports continue to climb

Despite an early Easter, red meat exports in March rose 9% from last year to 182,480 tonnes, making this past month the largest March in terms of exports since 2015 and the second largest on record.

Beef

Australia exported 106,574 tonnes of beef over March, 8% more than last year. The standout increase was exports to the United States, which rose by 58% year-on-year to 29,346 tonnes. Domestic production of beef in the US is continuing to decline, which is pushing the amount of beef in cold stores down and pulling imports up.

Outside of the US, Japan was the second largest market for the month, and exports lifted 3% year-on-year to 21,007 tonnes.

Exports to China and South Korea fell by 17% and 25%, respectively, compared to March last year, but exports remained above average, and the declines were mostly due to March 2023 being an abnormally high month for both countries.

Beef exports to the United Kingdom almost quadrupled to 506 tonnes as we approach the one-year anniversary of the ratification of the A-UK Free Trade Agreement. While remaining relatively small, exports to the UK have steadily grown over the past year and are highly concentrated in higher-value product segments like chilled beef and grainfed beef.

Lamb

Australian exports of lamb lifted 36% in March from 2023 levels to 30,707 tonnes. Like beef, the largest export market remained the United States, where exports lifted 50% from last year to 7,336 tonnes.

At the same time, exports to the Middle East and North Africa Region (MENA) saw substantial increases, rising by 47% to 6,143 tonnes. In particular, exports doubled to Saudi Arabia and Kuwait, which rose to 977 tonnes and 931 tonnes, respectively. Strong economic performance in Gulf countries, alongside a rapidly developing foodservice sector, continues to drive lamb exports into the MENA region.

As discussed last week, Australian lamb exports are now making up more of global trade than ever before. Strong results in 2024 suggest that this will not let up anytime soon.

Tim Jackson | Meat & Livestock Australia

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Australian goatmeat exports surge in 2023

Australian goatmeat exports for 2023 reached their second highest volume on record for a calendar year since 2014.

A total of 33,891 tonnes of shipped weight (swt) Australian goatmeat was exported in 2023, a significant increase on the 21,831 swt exported in 2022.

While volume was up, the value of exports was down, reflecting the decline in export goatmeat prices from over $12/kg to below $7/kg over the past 18 months.

Australia’s top three goatmeat export markets for volume in 2023 were the United States, China and South Korea, reflecting the significant increase in volumes exported to China.

China has now overtaken Korea as our second largest export market, despite Korea also increasing its volume.

Market share and export volumes to these three markets in 2023:

The US accounted for 43% of Australian goatmeat exports, with volume increasing to 14,477 swt in 2023, up from 12,505 swt in 2022.
China accounted for 20% of Australian goatmeat exports, with volume increasing to 6,757 swt in 2023, up from 290 swt in 2022.
South Korea accounted for 18% of Australian goatmeat exports, with volume increasing to 5,994 swt in 2023, up from 3,757 swt in 2022.

A number of other markets also increased their volumes in 2023, including Trinidad and Tobago, and to a lesser extent, Malaysia and New Zealand.

Meat & Livestock Australia

Hilton Food Group plans further expansion and more takeovers

Hilton Food Group is planning further geographic expansion and potential takeover deals after profits jumped by nearly two-thirds last year.

The food packaging company, which supplies major supermarkets including Tesco, Morrisons, and Waitrose, reported bumper pre-tax profits growth of 64.2 percent to £ 48.6 million in 2023.

Its UK seafood arm returned to operating profitability thanks to price hikes and new business contracts after being heavily impacted the previous year by surging cost inflation and supply chain disruption.

Hilton’s core meat segment also performed strongly amid volume growth in the Asia-Pacific region and a ‘resilient outturn’ across the UK and Europe.

In the British Isles, the firm’s revenue increased by 3.7 per cent at constant currency levels to £1.33billion as raw material price rises offset declining volumes.

Steve Murrells CBE, chief executive of Hilton Foods, said: ‘Over the past year, we’ve remained focused on executing our strategy, which has resulted in a good performance against a challenging market.

‘I am particularly pleased with the results in our seafood category, returning to full-year operating profitability following a successful turnaround.’

Harry Wise | This is Money

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NZ and EU trade agreement to take effect on May 1

SYDNEY, March 25 (Reuters) – New Zealand said on Monday a free trade agreement with the European Union would come into effect on May 1, after the country’s parliament ratified the deal.

New Zealand notified the European Union it ratified the agreement earlier on Monday, Trade and Agriculture Minister Todd McClay said in a statement.

Wellington and Brussels signed the deal in July 2023, with the European Parliament ratifying its side of the agreement in November.

New Zealand expects the deal to benefit its beef, lamb, butter and cheese industries, as well as removing tariffs on other exports like its iconic kiwi fruit.

The EU will see tariffs lifted on its exports including clothing, chemicals, pharmaceuticals and cars, as well as wine and confectionary.

The EU is New Zealand’s fourth-largest trade partner, according to government data, with two-way goods and services trade worth NZ$20.2 billion ($12.10 billion) in 2022.

Alasdair Pal | Reuters

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U.S. drought and weak yen lift Japan’s beef import costs

TOYOTA — Japanese wholesale prices for imported beef have hit the highest level since the market was opened up in 1991, as a drought in southern U.S. states curtails supply, prompting restaurants to weigh price hikes.

Domestic wholesale price of U.S. belly meat used in beef bowls and other dishes is currently between 1,080 yen and 1,200 yen ($7.13 and $7.92) per kilogram, up 38% from the same period last year. With the weak yen also driving up costs, the price surpassed the previous high reached in 2014.

Sixty percent of beef sold in Japan is imported. U.S. beef, which accounts for 40% of the imports, is used primarily by businesses, such as beef bowl chains and grilled beef restaurants.

Reduced U.S. beef production is the biggest factor for the price spike. The number of cattle being raised in the country is in a natural cyclical decline. And the drought in the South exacerbated the drop by reducing grass that cattle feed on.

According to the U.S. Department of Agriculture (USDA), the cattle inventory was 87.157 million head as of Jan. 1., the lowest level since 1951. Drought triggered the spike in prices in 2014, but the inventory decline is more significant this time.

Local producers are reducing exports to meet the U.S. appetite first. U.S. beef exports totaled 1.37 million tonnes in 2023, down 14% on the year. The USDA is forecasting a decrease of 8.3% to 1.26 million tonnes this year.

Nikkei Asia

Australian Government leads red meat mission in the UK

The Cook Government’s Minister for Agriculture and Food is leading the first Western Australian delegation of its kind to the United Kingdom, which includes some of the State’s major sheep meat and cattle producers.

Agriculture and Food Minister Jackie Jarvis is leading the first Western Australia delegation of its kind to the United Kingdom
Minister Jarvis and major WA sheep meat companies will visit Smithfield Market, one of the largest wholesale meat markets in Europe
The mission will also include meetings with the UK’s Minister of State for Food, Farming and Fisheries and stakeholders from the UK’s biggest supermarkets

The purpose of the ‘red meat mission’ is to establish strong relationships with UK market buyers and unlock new trade opportunities for WA farmers.

During the seven-day mission, Minister Jarvis will lead two WA sheep meat companies on a tour of the Smithfield Market, one of the largest wholesale meat markets, in Europe and meet with traders and buyers.

Fletcher International Exports, V & V Walsh and Pardoo Wagyu are looking to leverage the favourable provisions within the Australia-UK Free Trade Agreement to establish or enhance their presence in the UK market.

The delegation will have the opportunity to meet with local experts to further understand overseas supply chains and market entry requirements.

Minister Jarvis is also set to meet with the Minister of State for Food, Farming and Fisheries, the Right Honourable Mark Spencer MP, as well as the British Meat Processors Association, the International Meat Traders Association and Meat and Livestock Australia.

In addition, the delegation will attend the International Food & Drink event (IFE) in London, which will serve as a hub for more than 27,000 buyers for the UK’s entire food, drink, and hospitality supply chain – including stakeholders from Tesco, Marks & Spencer and British Airways.

The Cook Government will have a stand at the event to support WA’s agrifood businesses to showcase their products to global buyers.

WA.gov.au

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Meat wholesaler Macduff 1890 ceases operations

The family-owned, fourth-generation meat wholesale company Macduff 1890, under the leadership of Andrew Duff, the great-grandson of its founder, has ceased operations and closed.

Andrew Duff expressed his great disappointment that trading conditions had given him no other option,

He explained: “On Friday, March 15, Macduff 1890 ceased its operations, and it’s a decision made with deep sadness. I’ve personally contacted all our suppliers and customers to apprise them of the situation and to let them know that our doors are now closed.

“My personal passion has always been centred around championing rare and native breeds, and I earnestly hope that another firm within the meat industry will carry forward this passion.”

SAMW executive manager Scott Walker said: “It is very sad to see the closure of a long-established meat wholesale business. This is a reflection of the thin operating margins which the entire industry operates on and the challenging conditions the industry has faced in recent years.”

Kelly Henaughen | The Scottish Farmer

Scottish farmers demand clarity on £40m beef support scheme

NFU Scotland has called again on the Scottish Government to urgently bring forward details of its proposed reform of the Scottish Suckler Beef Support Scheme (SSBSS).

Government has confirmed that the scheme, currently worth £40 million, will be a feature of future support arrangements in Scotland.

Payments to eligible calves under the current scheme year are imminent but proposed changes to the scheme rules for 2025 and beyond, including the introduction of calving interval rules, have yet to be shared with the industry.

NFU Scotland wants the reformed SSBSS to include the following:

• The budget should be retained and continue to be delivered in the same cyclical manner

• Split payments between meeting existing eligibility criteria and new conditionality

• A mechanism for recognition of pre-registration of stillborn calves

• For a ‘force majeure’ option to be available for any producers affected by unforeseen or exceptional circumstances.

NFU Scotland livestock chair Hugh Fraser said: “We continue to ask for clarity on this vital scheme for those producing beef calves in Scotland. It is not feasible, fair nor realistic for the industry to operate on speculation.

“With payments under the 2023 scheme expected in bank accounts soon, the importance of a clear and timely announcement on arrangements for the new scheme year are essential. [The] Scottish Government must give explicit clarity on their expectations for suckler beef producers so that we can have some certainty”.

By Alec Ross | The Herald Scotland

Python ‘tastes like chicken and should be part of our diet’

Python meat should be seen as a serious alternative to chicken and beef because of its environmental benefits, according to a scientific study.

Academics say the non-venomous snakes require less food than traditional livestock such as pigs or cattle and can grow at a faster rate during farming.

Dr Daniel Natusch, an honorary research fellow at Macquarie University in Sydney, has suggested its meat should be introduced to restaurant menus, adding he himself is a fan.

“At the risk of repeating a cliché, it tastes a lot like chicken,” said Dr Natusch. “You run the knife along the back of the snake and you almost get a four-metre-long filleted steak. Firm white meat, no bones. I’ve had it barbecued, in curries, as biltong and, yeah, it’s great.”

His study, published in the Scientific Reports journal, examined the growth rates and diets of more than 4,000 reticulated and Burmese pythons at two large farms in Thailand and Vietnam.

Dr Natusch found that a well-fed baby python can double in size in a matter of weeks, and can put on more than 45 grams of body weight a day, reaching up to four metres long after a year.

Albert Tait | The Telegraph