Australian Beef Exports Dropped to New 19-Year Low in 2022

According to data from the Australian Department of Agriculture, Fisheries and Forestry, Australian fresh, chilled and frozen beef, including veal, exports dropped 3.7% year-over-year (YoY) to 855 thousand mt, their lowest level since 2003. Australia is in an ongoing herd rebuilding process, which is necessary after drought considerably dwindled cattle numbers in previous years. The process, which continued through 2022 and which was further incentivized by favorable weather conditions, resulted in considerably low slaughter numbers -projected to be the worst in decades- and a subsequent decrease in exports.

Except for China, all major export destinations lost ground YoY. Exports to Japan, the largest destination, fell 8.3% YoY to 214 thousand mt, which represents a 25% market share. In fact, according to data from Japan Customs, Japanese beef import volume from Australia during January-November 2022 declined 11% YoY and Australia’s share in Japan’s beef import total dropped to 37% from a previous 41%. Australia lost its status as Japan’s main import origin to the US, which also exported less beef YoY to Japan, albeit with a lesser decline than Australia’s.

Meanwhile, Australian exports to Korea fell 2.6% YoY to 161 thousand mt, representing a 19% market share. Exports to China climbed 6.6% YoY (+9.7 thousand mt) to 158 thousand mt, an 18% market share. Exports to the US dropped 8% YoY to 133.8 thousand mt, a 16% market share.

It's worth mentioning that the countries with the largest YoY gains (in total volume basis) beside China include Thailand, to which exports grew by 3.1 thousand mt (+32%) to reach a total of 13.1 thousand mt (1.5% of Australia's export market share), and Canada, to which exports grew by 3.4 thousand mt (+49%) to reach a total of 10.5 thousand mt (1.2% of the total share).

Source: Tridge and Australia Department of Agriculture, Fisheries and Forestry

Nonetheless, exports are set to recover in 2023 as beef production rises. The USDA forecasts Australian beef production to rise by 13% to 2.2 million mt. Cattle slaughter should rise with greater cattle availability, with all the more reason if the country’s industry is able to resolve the issue of having a sufficient number of beef processor workers. An increase in Australian production, coupled with a decline in US domestic beef production due to a dwindling of herd numbers derived from drought conditions throughout 2022, will likely result in an increase in Australian beef exports in 2023.