澳牛,以20% 增速,朝兴盛中国市场奔来

Rising popularity ... Australian beef cattle. Photo: Brendan Esposito

China will have to increase its beef imports by up to 20 per cent a year for the next five years to meet its surging demand for protein, rural lender Rabobank says.

Despite measures to minimise its dependence on foreign beef, China faces a growing gap in beef supply. This is good news for Australian beef producers - who export about 80 per cent of their beef - ahead of high-level trade and market access discussions between the Abbott government and the People’s Republic.

According to Rabobank analyst Chenjun Pan, China’s beef imports almost quadrupled from 2012 levels to 297,000 tonnes last year, while beef prices in China have risen fivefold since 2000.

The Chinese government launched its first national support program for its beef industry in September 2013, called the “Guideline for Beef Industry Development Towards 2020”. The plan aims to increase its domestic production from 6.3 million tonnes to 7.17 million tonnes in 2015 and 7.86 million tonnes in 2020.

But the government plan is unlikely to curb an insatiable appetite for foreign beef.

“China’s beef industry faces great challenges even with the addition of government support,” Pan says. “China’s domestic production will slowly recover but not fast enough to catch up with the accelerating demand. The structural supply deficit will force an increase in beef imports of nearly 20 per cent - including smuggled beef - or even double the current import volume by 2018.”

Forecasts from the US Department of Agriculture show that China is looking to further increase its fast-growing corn imports to feed domestic cattle and limit dependence on imports. But rising incomes and urbanisation in the world’s second biggest economy is driving dietary changes that China’s domestic beef industry cannot keep pace with.

“The local beef production system has lagged behind other beef-producing countries in many aspects and the gap in productivity is getting wider,” Pan says. “China will need to allow more imports, which are expected to increase by 15 per cent to 20 per cent each year for the coming five years.”

Jason Strong, the chief executive of the nation’s biggest beef producer Australian Agricultural Company, told Fairfax Media this week that he is targeting top-end Asian and Middle Eastern restaurants and hotels with AACo’s high value Wagyu and grain-fed beef.

Diners at the Rib Room in Dubai’s Jumeirah Hotel will pay $160 for a 250 gram cut of AACo’s Kobe Cuisine tenderloin, and Strong is chasing those big spending customers. After back-to-back years of crippling drought, and turmoil in the domestic cattle market following the 2011 ban of live cattle exports to Indonesia, the Abbott government’s free trade deals with Korea and Japan have given the beef industry new hope.

Reduced tariffs on Japanese and South Korean beef imports - both key markets for Australia - are worth billions of dollars to the industry.

The Chinese government may want to limit its dependence on imports, but the statistics suggest it may look to increase market access for Australian producers as the Coalition tries to cement an FTA with China.

The Australian red meat industry is worth an estimated $7.4 billion per annum and employs about 200,000 workers, according to Meat & Livestock Australia. About four per cent of the world’s beef supply is produced by Australia, making it the third largest exporter.