Like what you've read?

On Line Opinion is the only Australian site where you get all sides of the story. We don't
charge, but we need your support. Here�s how you can help.

  • Advertise

    We have a monthly audience of 70,000 and advertising packages from $200 a month.

  • Volunteer

    We always need commissioning editors and sub-editors.

  • Contribute

    Got something to say? Submit an essay.


 The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
On Line Opinion logo ON LINE OPINION - Australia's e-journal of social and political debate

Subscribe!
Subscribe





On Line Opinion is a not-for-profit publication and relies on the generosity of its sponsors, editors and contributors. If you would like to help, contact us.
___________

Syndicate
RSS/XML


RSS 2.0

Slaughtering Indonesia's cattle trust

By David Leyonhjelm - posted Tuesday, 23 August 2011


The government’s decision to halt live cattle exports to Indonesia, without warning, deeply disturbed Indonesia. Australian beef accounts for 25 per cent of the country’s meat and is a vital source of protein for millions of Indonesians. There are also thousands employed in feedlots, abattoirs and downstream processing, and Indonesia had considered Australia to be close enough to form part of its own food security.

In addition, the Australian government has long had a policy of supporting neighbouring countries that are members of global animal health organisation OIE as they progressively implement its standards of animal handling and welfare. Indonesia is such a member.

The export ban undermined all that. Many in Indonesia now regard Australia as an unreliable supplier, and there are strong indications the country will seek to diversify its sources by importing cattle and beef from other countries while renewing efforts to become self-sufficient in beef by 2014.

Advertisement

It will be some time, perhaps several years, before we see the full impact of that. For the moment, the Indonesians are displaying remarkable tolerance, probably much more than Australians would show if another country had suddenly cut off a major part of our food supply. Permits to import live cattle have been reissued and there is no overt resentment at Australia’s insistence on supervising the treatment of cattle owned by Indonesians within Indonesia.

The Indonesian government allows live imports because they satisfy demand for freshly slaughtered meat sold in wet markets. This is popular for financial and cultural reasons and a necessity for those who do not have access to refrigeration. Live imports also generate local employment in feedlots and abattoirs. Indeed, the reason cattle from Australia cannot exceed 350 kg is to ensure they must undergo local fattening prior to slaughter.

Australia has a natural advantage as a supplier of live cattle, given its proximity and Brahman species, but is not the only possible source. Brazil, with more than six times Australia’s cattle population, would be quite happy to supply Indonesia. So would Argentina, which has double Australia’s cattle population.

There is also a large market for boxed beef in Indonesia, chilled and frozen, into which Australia sold over 50,000 tonnes in 2009. Chilled beef, which is higher quality and more expensive, is mainly sold in supermarkets and restaurants. Frozen beef, which includes some lower priced options, can be thawed and sold in wet markets although it is not the preferred choice of consumers.

There are two reasons Indonesia is not already importing live cattle from countries other than Australia. One, fairly obviously, is freight. The other is the risk of introducing foot and mouth disease (FMD). Indonesia is classified by the OIE as FMD-free without vaccination and has a policy of only importing cattle and cattle products from countries that are similarly classified (as does Australia).

FMD occurs in Brazil and Argentina, although not everywhere. Both have states or regions classified as FMD-free without vaccination and also areas classified as FMD-free with vaccination. A growing number of FMD-free countries are willing to accept imports from one or both of these in order to take advantage of their lower prices.

Advertisement

With boxed beef, Indonesia has choices apart from Australia, including New Zealand and the US. If it were to allow imports from FMD-free regions or states, it would have more. Most can produce beef at prices that are comparable to Australia’s.

There is also a possibility of beef being imported from India, which was contemplated a couple of years ago but did not proceed. Some Indian states are FMD-free, although they are not internationally recognised. India has 280 million cattle, the majority of them buffalo, equal to the combined cattle numbers of Brazil and the US and about fourteen times that of Australia. Indian beef is said to be the cheapest source of red meat protein in the world.

Irrespective of what the Indonesian government does about diversifying sources, the Australian government’s new permit system for live cattle exports will stimulate a search for alternative supplies. Only a handful of exporters will be able to retain responsibility for cattle as they progress through Indonesian feedlots and abattoirs. MLA is predicting exports to Indonesia will be down 40 per cent this year.

  1. Pages:
  2. Page 1
  3. 2
  4. All

This article was first published on Business Spectator on August 22, 2011.



Discuss in our Forums

See what other readers are saying about this article!

Click here to read & post comments.

10 posts so far.

Share this:
reddit this reddit thisbookmark with del.icio.us Del.icio.usdigg thisseed newsvineSeed NewsvineStumbleUpon StumbleUponsubmit to propellerkwoff it

About the Author

David Leyonhjelm is a former Senator for the Liberal Democrats.

Other articles by this Author

All articles by David Leyonhjelm

Creative Commons LicenseThis work is licensed under a Creative Commons License.

Photo of David Leyonhjelm
Article Tools
Comment 10 comments
Print Printable version
Subscribe Subscribe
Email Email a friend
Advertisement

About Us Search Discuss Feedback Legals Privacy