Bullish market for beef

By Tony Scott,
September 08, 2021

Beef farmers are being advised to fasten their seatbelts for what could be another run on prices in what is already a very buoyant sector.

The discovery of mad cow disease in two separate tests in Brazil has led to the immediate closure of the China market for Brazilian beef, as trade protocols dictate.

Brazil is one of the world’s biggest beef exporters particularly to China.

The tests were described as atypical and in old cows, which can develop Bovine Spongy Encephalopathy spontaneously due to advanced age.

A similar incident in 2019 resulted in a suspension of exports for less than a fortnight.

But the global market is nervous in response to the latest ban and local beef industry figures say the impact on supply and demand “can’t do us any harm”.

China imports relatively little beef from Australia, but with a drought affecting production across North America, political issues restricting exports from Argentina, added to the Brazilian ban, it’s clear there are severe limits on supply.

China takes well over half of its beef from South American producers.

Buyers of Tasmanian beef cattle had been expecting some easing of prices but are reassessing that view.

Store cattle have recently been selling at near record levels and on the back of favourable seasonal conditions many farmers can’t recall better times.

The impact of the increasing demand will be felt beyond the farm gate too.

Lovers of a good beef steak from a restaurant, pub or even the butcher might be advised to expect a hike in the price they’ll be asked to pay.