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2. World Meat Consumption and Trade,

Australian Markets and

the Australian Meat Industry

Diana Perry

Learning objectives

On completion of this topic you should be able to:

discuss the link between consumption and meat trading patterns

identify major world trade patterns in beef and sheepmeats

list Australia's major markets for beef, sheepmeat and pork

describe how these markets have changed over time

Key terms and concepts

Consumption, trade, exports, imports, live export.

Introduction to the topic

Consumption of the various types of meat varies from country to country, and changes with time. Most of the world�s meat is consumed in the country of origin and only a small proportion is traded on international markets. This topic provides background information on current world meat consumption and trade, markets for Australian meat and some of the characteristics of the Australian meat industry.

2.1 Current meat consumption

AustraliaPer capita consumption/year of meat in Australia from 1969 to 1999 is shown in Figure 2.1, and has increased slightly in terms of total kg/head.

Over this period the consumption of poultry increased fourfold, from 8.3 kg/head to 30.8 kg/head and there has also been a significant increase in pigmeat consumption (6.7 kg/head to 19 kg/head). At the same time the consumption of sheepmeat has fallen (18.8 kg/head to 4.5 kg/head for mutton and 20.5 kg/head to 11.8 kg/head for lamb). Per capita consumption of beef and veal has fallen slightly, from 40

MEAT418/518 Meat Technology - 2 - 1

©2009 The Australian Wool Education Trust licensee for educational activities University of New England

Notes – Lecture 2 – World Meat Consumption and Trade, Australian Markets and the Australian Meat Industry

kg/head to 36.4 kg/head. Surveys indicate that there is a gradual increase in the number of non meat-eaters in the Australian population. From 1969 to 1999 per capita consumption of seafood has almost trebled, and that of fruit and vegetables has almost doubled.

2 - 2 – MEAT418/518 Meat Technology


Total tonnes

consumed(t)

0

500

1000

1500

2000

2500

96-97 97-98 98-99 99-00 2000-01 2001-2002

poulty

pig

lamb

mutton

Beef and veal

Year


Figure 2.1 Australian consumption of meat 1969-1999 kg/capita. Values are average kg/head for previous 3 years. Source: Adapted from ABARE (2002).

On the other hand, tonnage of meats consumed has been relatively stable over the past few years, as population increase has offset the reduction in per capita consumption (Figure 2.2).

Figure 2.2 Australian consumption of meat 1996-2002 (total tonnes). Source: Adapted from ABARE (2003).

World consumptionMeat consumption increases as per capita income for a country increases, although the relationship is not linear. This relationship is shown in Figure 2.3. The type of meat eaten depends on geography and culture. In 2000 per capita consumption of meat was highest in the USA (126 kg), compared to Australia (104 kg), Japan (43.4 kg), China (49 kg), Spain (112.8 kg), UK (79.6 kg) and Singapore (19.2 kg). Some countries with high per capita income but low per capita meat consumption are those which have a high seafood intake.

As standards of living rise meat consumption increases. Based on knowledge of current consumption, trends in per capita disposable income and population, it is possible to identify future market possibilities for Australian meats.




Figure 2.3 Relationship between income and meat consumption Source: ABARE (2002).

2.2 World meat trade

The main types of meat produced in the world are pork, poultry, beef (including veal and buffalo) and sheepmeat. Shares of total world meat production and the percentage of each in world trade are shown in Figure 2.4 below.

Figure 2.4 Shares of world meat production. Source: CAAA (2003).




Pig meatAsia, in particular China, is the largest pig meat producing region, with about 56% of world production. Western Europe produces about 22%, North America about 14%, and Eastern Europe about 6%, of world production. The ten major exporters and importers of pork meat are shown in Tables 2.1 and 2.2.

Table 2.1 Projected top ten pork exporters 2002. Source: APL (2002).

Table 2.2 Projected top ten pork importers 2002. APL (2002).




PoultryThe USA, China, Brazil and the EU are the largest producers and exporters of poultry meat. The largest importers or poultry meat are the Russian Federation and Japan. Tables 2.3 a and b show the major traders of poultry.

Table 2.3 Major world trade in poultry, showing (a) production and consumption and (b) imports and exports. Note: The USA figures are listed at the bottom with the totals. Source: USDA FAS (2006).a)




b)




SheepmeatNew Zealand and Australia are by far the key exporters of sheepmeat while the key importers are the USA, Asia and the Middle East. The ten major exporters of sheepmeat are shown in Figure 2.5.

Figure 2.5 Top ten exporters of sheepmeat. Source: MLA (2005b).

Beef and vealCurrent world trade in beef is determined by factors such as market access barriers, disease status and differences in supply competitiveness. World trade can be separated into two major trading activities, supplying the Atlantic and the Pacific Rim markets which account for 44% and 55% of world trade respectively.

World trade in beef and veal is characterised by a few large importers and exporters. Major exporters are Brazil, Australia, Argentina and New Zealand (Figure 2.6). The USA, Japan, the Russian Federation and the EU are key importers. Tables 2.4 a and b show the major traders of beef.

Figure 2.6 Top ten exporters of beef. Source: MLA (2005a).




Table 2.4 Major world trade in beef, showing (a) production and consumption and (b) imports and exports. Note: The USA figures are listed at the bottom with the totals. Source: USDA FAS (2006).

a)




b)




2.3 Australian meat exports

The first exports of meat from Australia occurred in 1879. In November, the SS Strathleven left Sydney with a cargo of frozen meat and butter which was discharged in good condition in London in February 1880 - the first successful overseas shipment of frozen food. Beef and sheepmeat form the bulk of Australian meat exports, with relatively little pig meat or poultry meat being traded.

BeefBeef exports dominate Australia�s trade in meat. In 2004-05 Australia exported 65% of its total beef production, valued at approximately $4.9 billion (MLA 2005a) to over 100 countries. Japan and the USA are the major markets for Australian beef exports. Japan overtook the USA as Australia’s number one export market in terms of both volume and value in 1993-94. However a BSE (Bovine Spongiform Encephalopathy) scare in Japan resulted in a decline in this market so that in 2001/02 the USA had once again become the largest importer of Australian beef. By early 2003 however the Japanese market had recovered with exports to Japan back to their pre-BSE levels. Over recent years, Korea has also become an important market for Australian beef.

Figure 2.7 Australia's major beef export markets in 2004-05. Source: MLA (2005a).

Figure 2.8 Australian live cattle exports in 2004-05. Source: MLA (2005a).




Live cattle exports from Australia totalled 623,579 head in 2004-05, valued at $464 million (MLA 2005a). Indonesia is the primary live cattle export market, followed by China, Malaysia and the Philippines. The live cattle trade into Asia rose dramatically from 1990-91 until 1996-97 when numbers peaked at 859,000. This number declined to 663,000 in 1997-98, but was back to 800,000 plus in 2001-02. About 10% of cattle turned off go to the live trade with about 80% of those shipped from WA and NT.

Sheep meatsAustralia is the second largest exporter of sheepmeat in the world behind New Zealand. Australia exported 41% of its total lamb production and 74% of its total mutton production in 2004-05 valued at $701 million and $418 million respectively (MLA 2005b). The key export markets for Australian lamb are the USA and North Asia (Figure 2.9) while the Middle East and North Asia are the largest markets for Australian mutton (Figure 2.9).

Figure 2.9 Australia's major lamb export markets in 2004-05. Source: MLA (2005b).

Figure 2.10 Australia's major mutton export markets in 2004-05. Source: MLA (2005b).




Australia is the world’s largest live sheep exporter with about 3.2 million live sheep valued at $210 million exported in 2004-05 (MLA 2005b). Almost all of these went to the Middle East with the main importing countries being Jordan, Kuwait and Bahrain (Figure 2.11). The live sheep trade fluctuates with political unrest in the Middle East, and perceptions of poor quality product. The majority of live sheep are shipped from WA (86%) while small proportions are shipped from Vic and SA (12%).

Figure 2.11 Live sheep exports for 2004-05. Source: MLA (2005b).

Pig meatsAustralia is a relatively small player in world pig meat trade. Our major export markets for pork are Singapore, New Zealand and Japan with the New Zealand market showing the most growth over the past few years (Figure 2.12).

Figure 2.12 Australia’s pork export markets 2003 to 2005. Source: APL (2005b).




2.4 Meat industry characteristics

Australian livestock is produced from diverse environments across the continent, with more than 75,000 farms and pastoral properties producing livestock for slaughter. An internationally competitive meat and livestock industry will remain of major importance for Australia�s economic future.

CattleThe Australian cattle industry (including live exports) is worth about $7.7 billion with the Australian herd comprising some 27.5 million cattle including calves (MLA 2005a). Total beef production in Australia is over 2 million tonnes with 70% sourced from Queensland and New South Wales (Figure 2.14).

Figure 2.13 National cattle numbers by State as at June 2004. Source: MLA (2005a).

Figure 2.14 Australian beef and veal production. Source: MLA (2005a).




Grainfeeding of cattle is increasing. From 1980 until the early 1990�s there was a steady increase in the number of cattle finished in feedlots. The number of cattle on feedlots in 1994 was about 400,000. By 2002 this number had nearly doubled and in June 2005 there were about 880,000 head on feed. Opportunity feedlots on farms have also increased substantially in recent years.

Figure 2.15 Numbers of cattle in feedlots in June 2005. Source: MLA (2005a).

There is increasing herd productivity within Australian cattle herds. This has occurred over the past 15 years. From 1984 to 1992, there was a 30% increase in beef production with only a 16% increase in the herd. The reasons include:

reduced morbidity and improvements in calving practices

cattle slaughter at younger ages but greater weights

increases in average carcase weight of 15% between 1980 and 1992.

SheepThe Australian sheep industry (including the live trade) is worth approximately $1.9 billion. From 1982 sheep numbers increased steadily to 170 million in 1990 then declined to approximately 120 million in 1996, and 110 million in 2001. At June 2004 numbers had declined even further to 101 million (72 million sheep and 29 million lambs).

Figure 2.16 Australian sheep numbers by State as at June 2004. Source: MLA (2005b).




Sheepmeat production in Australia in 2004-05 totalled approximately 590,000 tonnes comprising 354,000 tonnes of lamb and 237,000 tonnes of mutton (MLA 2005b). This is equivalent to 6.8% of total world production of sheepmeat, with Australia being the third largest producer behind China and the EU.

Figure 2.17 Mutton production for 2004-05. Source: MLA (2005b).

Figure 2.18 Lamb production for 2004-05. Source: MLA(2005b).




Pigs Numbers are stable at around 2.7 million, with 290,000 sows.

In breeding herds, sows average 2.2 litters and 19.4 pigs weaned per year.

Age at sale averages 170 days, liveweight at slaughter 96.2 kg and carcase weight approx. 69 kg.

Figure 2.19 Weight of pigmeat exported 2001-2005. Source: APL (2005c).

Figure 2.20 Monthly weight of pork imported 2004 - 2005, with country of origin. Source: APL (2005a).




Figure 2.21 Export/import ratio of pork 2000 - 2005. Source: Drum et al. (2006).

ReadingsThe following readings are on web management learning systems:1. Dept Agriculture, Fisheries and Forestry: Australian Food Statistics 2002

Summary In developed countries meat consumption is static, though share of different meats may

change In developing countries meat consumption is rising as income rises Some countries traditionally eat more red meat than others, regardless of income Most countries produce only enough meat for their own consumers Australia is a major exporter of beef and sheep meat Australia exports virtually no poultry or pig meat Japan and the USA are Australia's major markets for beef, although over 100 countries

import Australian beef Middle Eastern and Asian countries are Australia's major markets for sheep meat, with the

USA being a major market for lamb, but not mutton. Queensland and NSW produce most of Australia's beef and veal Grainfeeding of cattle is increasing Mutton is essentially a by-product of the wool industry NSW is the largest producer of mutton NSW and Victoria are the largest producers of lamb.

References




ABARE (2002). Australian Food Statistics (2002), Appendix 4.4, AFFA (Agriculture, Fisheries and Forests Australia), retrieved 22 March 2006 from website http://www.affa.gov.au/content/publications

ABARE (2003). Australian Food Statistics 2003, ABARE, retrieved 22 March 2006 from website http://www.abare.gov.au/publications

Anon 2000. Prevention of fresh meat colour defects. Meat Technology Update Newsletter 00/2. Food Science Australia, Brisbane aug05%2Epdf.

Australian Pork Limited (APL) 2002, ‘Section 10 – Imports and Exports’ in PigStats 2002, retrieved 22nd March 2006 from: http://www.australianpork.com.au/media/sect10%2Epdf.

Australian Pork Limited (APL) 2005a, ‘April 2005 Pork Import Report’ in Pork Trends Issue 34 – June 2005, retrieved 22nd March 2006 from: http://www.apl.au.com/media/porktrends%5F

Australian Pork Limited (APL) 2005b, ‘May 2005 Pork Export Report’ in Pork Trends Issue 36 – August 2005, retrieved 22nd March 2006 from: http://www.apl.au.com/media/porktrends%5F

Australian Pork Limited (APL) 2005c, ‘June 2005 Pork Export Report’ in Pork Trends Issue 37 – September 2005, retrieved 22nd March 2006 from: http://www.apl.au.com/media/

Bobbitt, J.(2002) Shelf life and microbiological safety of selected new and emerging meats RIRDC publication 02/03

China Animal Agriculture Association (CAAA) 2003, ‘Meat proportion (2003 World), in Section 3: Structure of Animal Agriculture, Industry Profile retrieved 22nd March 2006 from: http://www.caaa.org.cn/ profile/basic.php.

Dept Agriculture, Fisheries and Forestry: Australian Food Statistics 2007

Drum, F., Dickson, A. and Hogan, J. 2006, ‘Meat Outlook to 2010-11’ in Australian Commodities – March Quarter, vol. 13(1), pp. 70-81.

Fast Facts 2007: Australia's Sheepmeat Industry

Hopkins, D.L, Beattie, A.S., Pirlot, K.L. 1995. The meat quality carcase fatness and growth of short scrotum lambs grazing either forage rape or irrigated perennial pasture. Australian Journal of Experimental Agriculture vol 35 pp 453-459 june05%2Epdf.

Lawrie, R.A. 1991. Meat Science. Fifth ED. Ch. 10. Pergamon Press. Oxford, New York, Seoul, Tokyo

Meat and Livestock Australia (MLA) 2005a, Fast Facts. Australia's Beef Industry 2005. Meat and Livestock Australia, Sydney.

MLA Fact Sheet: Maximising sheepmeat eating quality : A guide for retailers, foodservice and wholesalers

MLA Fast Facts 2005: Australia's Sheepmeat Industry

MLA Fast Facts 2006: Australia's Beef Industry MLA

MLA Fast Facts 2006: Australia's Beef Industry MLA Meat and Livestock Australia (MLA) 2005b, Fast Facts. Australia's Sheepmeat Industry 2005. Meat and Livestock Australia, Sydney.

O'Donnell, V., Dickson, A. and Wood, A. 2006. Sheep Industry Outlook to 2010-11, Australian Bureau of Agriculture and Resource Economics (ABARE), Sydney, Australia

Pethick, D., D’Souza, D., Anderson, A., Muir, L., (eds.) 2005, Eating quality of Australian lamb and sheep meats , Australian Journal of Experimental Agricultural, Victoria. Volume 45, Number 5, 2005, pp 465-601 porktrends%5Fsep05%2Epdf.



http://www.apl.au.com/media/

http://www.apl.au.com/media/porktrends_

http://www.apl.au.com/media/porktrends_

http://www.abare.gov.au/publications

http://www.affa.gov.au/content/publications


United States Department of Agriculture – Foreign Agricultural Service (USDA FAS) 2006, Livestock and Poultry: World Markets and Trade, Circular March 2006 Issue, retrieved 23rd March 2006 from: http://www.fas.usda.gov/dlp/circular/2006/06-03LP/toc.htm.

Glossary of termsAuroch Large recently extinct longhorned European wild ox; considered one of the

ancestors of domestic cattle

Aversion Intense dislike

Nomadic The culture of continuously herding animals to wherever forage was abundant

Offal Non-carcase parts of a butchered animal. Can be further subdivided into edible or inedible offal

Retail The sale of goods or commodities in small quantities directly to consumers

Tallow Animal fat

Wholesale The sale of goods in quantity for resale purposes, (i.e. goods sold in bulk to retailers for resale)



http://www.fas.usda.gov/dlp/circular/2006/06-03LP/toc.htm

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