The Australian beef industry faces crisis as feed grain prices increase due to the ongoing drought in the country.
Australia is the world’s biggest beef exporter in terms of value and the second-biggest in terms of volume, selling principally to Japan and Korea in North Asia and to the United States.
The country boasts 700 feedlots, in which steers are fattened, mainly on wheat, barley and sorghum, prior to export to lucrative overseas markets, but drought has decimated crops, and prices of all grains have doubled since June.
Supplies of quality beef both onto the domestic market and to export markets are thus likely to subside substantially, with prices increasing to prohibitive levels for consumers.
Many feedlots appear to have closed down and, of those that survive, none are at full capacity. For only the second time since colonial times, Australia is likely to have to import grain, but this will not help the cattle industry, since national quarantine regulations prohibit the transport of unprocessed imported grain outside metropolitan areas.