Mike
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Australia beef gets new boost from Japan's United States ban
SYDNEY: Australia's booming beef industry has been given another boost from Japan's lastest ban on U.S. beef, with prices already rising and another big year of exports in store to the top North Asian market.
Australian beef, which rocketed to a 90 percent share of the Japanese market after the country banned U.S. beef for two years in late 2003, was spared from losing a big chunk of that business when the Tokyo government reimposed the ban two weeks ago.
''In the short-term clearly it does help us,'' said Peter Weeks, chief market analyst at Australia's meat industry authority Meat & Livestock Australia.
The ban on U.S. beef imports, lifted just a month previously, was reinstated on Jan. 20 after inspectors at a Japanese airport discovered spinal material -- prohibited under a beef trade agreement between the two countries -- in veal shipped by a New York meatpacker.
The initial ban was imposed after the discovery of mad cow disease in the United States in December 2003, which had halted annual trade worth about $1.4 billion.
Australian beef is already reaping a pay-off from the new ban, with cattle prices rising to boost the Eastern Young Cattle Indicator to 359 Australian cents a kilogram on Wednesday, up from 349 just before Japan's new ban.
Prices of Australian cattle had been expected to decline by at least 10 percent in 2006 because of the expected loss of market share in Japan. The price fall would now probably be limited to less than 5 percent, Weeks said.
Michael Hartmann, deputy director of Cattle Council of Australia, which represents Australia's cattle producers, welcomed gains for the Australian industry but added that the latest ban would not improve world-wide demand for beef.
The trade consensus is that the new bans will cause a delay of three to six months in U.S. beef sales to Japan. U.S. beef will probably not be back in Japan until mid-year, Weeks said.
Even when it does return, Japanese consumers and traders could be more wary of American beef than before, giving Australian beef a long-term structural boost.
While Japan's ban on U.S. beef should aid Australian beef exports, 2006 is still likely to see some decline in the value of exports following the near record A$4.3 billion ($3.3 billion) posted in 2005.
Korea and Hong Kong, both significant beef markets, have eased bans on U.S. beef, and Taiwan will soon resume imports.
''In a broad sense we're disappointed to see BSE back on the front pages of Japanese newspapers,'' Weeks said. ''It's going to mean the job of getting consumers in Japan back to eating beef the way they used to be will be that much harder.'' ($1=A$1.32)
SYDNEY: Australia's booming beef industry has been given another boost from Japan's lastest ban on U.S. beef, with prices already rising and another big year of exports in store to the top North Asian market.
Australian beef, which rocketed to a 90 percent share of the Japanese market after the country banned U.S. beef for two years in late 2003, was spared from losing a big chunk of that business when the Tokyo government reimposed the ban two weeks ago.
''In the short-term clearly it does help us,'' said Peter Weeks, chief market analyst at Australia's meat industry authority Meat & Livestock Australia.
The ban on U.S. beef imports, lifted just a month previously, was reinstated on Jan. 20 after inspectors at a Japanese airport discovered spinal material -- prohibited under a beef trade agreement between the two countries -- in veal shipped by a New York meatpacker.
The initial ban was imposed after the discovery of mad cow disease in the United States in December 2003, which had halted annual trade worth about $1.4 billion.
Australian beef is already reaping a pay-off from the new ban, with cattle prices rising to boost the Eastern Young Cattle Indicator to 359 Australian cents a kilogram on Wednesday, up from 349 just before Japan's new ban.
Prices of Australian cattle had been expected to decline by at least 10 percent in 2006 because of the expected loss of market share in Japan. The price fall would now probably be limited to less than 5 percent, Weeks said.
Michael Hartmann, deputy director of Cattle Council of Australia, which represents Australia's cattle producers, welcomed gains for the Australian industry but added that the latest ban would not improve world-wide demand for beef.
The trade consensus is that the new bans will cause a delay of three to six months in U.S. beef sales to Japan. U.S. beef will probably not be back in Japan until mid-year, Weeks said.
Even when it does return, Japanese consumers and traders could be more wary of American beef than before, giving Australian beef a long-term structural boost.
While Japan's ban on U.S. beef should aid Australian beef exports, 2006 is still likely to see some decline in the value of exports following the near record A$4.3 billion ($3.3 billion) posted in 2005.
Korea and Hong Kong, both significant beef markets, have eased bans on U.S. beef, and Taiwan will soon resume imports.
''In a broad sense we're disappointed to see BSE back on the front pages of Japanese newspapers,'' Weeks said. ''It's going to mean the job of getting consumers in Japan back to eating beef the way they used to be will be that much harder.'' ($1=A$1.32)