73rd Edition : December 2019.
- Oversupply keeps Indonesian live cattle prices weak.
- Brazilian beef has reached Indonesian wet markets in volume.
- African Swine Fever confirmed in Indonesia.
- Vietnamese and Thai prices up again this month.
Indonesia : Slaughter Steers AUD $4.09/kg live weight (Rp9,650 = $1AUD)
Slaughter cattle prices have edged up slightly as the oversupply during December was not quite as serious as during November with the indicator price rising to Rp39,500 per kg. Overfat steers in Lampung have been discounted to Rp38,500 while high yielding steers can achieve Rp41,000 or more.
The Brazilian beef has well and truly arrived in Indonesia with lots of product in the wet markets of Java with prices as published last month (see list below). Knuckle remains around Rp90,000 per kg which keeps it just above Indian buffalo price.
Packaging in the photos below shows that both JBS (Friboi) and Minerva have significant volumes in the market.
Brazilian beef prices –
Knuckle 90.000 Rp per kg.
Chuck tender 85.000
Outside Flat 81.000
Eye round 90.000
Hilmasel / Shank 78.000
Chuck roll 74.000
70 cl 58.000
90 cl 71.000.
African Swine Fever (AFS) has now been formally confirmed by the Indonesian authorities as reported in the FAO update map below. The official numbers as of the end of December are 28,000 pigs dead in North Sumatra since the initial deaths commenced on the 4th of September 2019. Sumatera and Java have only limited numbers of pigs while Bali and the Eastern Islands have large populations as their cultures are predominantly Hindu and Christian respectively. Quarantine measures have been stepped up to help prevent the spread of ASF into these locations but given the huge numbers of Chinese tourists arriving on more than 10 direct flights from China to Bali every day, I don’t like their chances.
Darwin feeder steer prices have weakened a little to an indicator rate of $3.25 per kg landed Darwin at the end of December.
Vietnam : Slaughter Steers AUD $4.66 / kg (VND16,000 to $1AUD)
Slaughter cattle prices have risen again this month with Dong500 per kg live weight being added to most categories of stock. Rising pork prices continue to destabilize all the protein markets with live pig rates doubling since September 2019. This is despite a significant reduction in the demand for pork (down about 20% according to government figures) as consumers are put off by both high prices and negative sentiment from the general spectre of diseased pigs. The government has been trying hard to address these problems with a range of initiatives from dramatically increasing imports (100,000 tons for the Tet holiday period) to cracking down on traders hoarding product for the upcoming Lunar new year. Tet is celebrated by holidays from 24 to the 29th of January with the actual Tet New Year’s Day on the 25th.
Official statistics show that pork accounts for 70-75% of the diet of Vietnamese consumers, poultry accounts for 20-25%, while beef, buffalo, sheep and goats only about 5-10%. Aussie live cattle and beef producers are one of the few winners from the ASF disaster with even stronger demand likely in the short to medium term.
China : Slaughter Cattle AUD $6.82 / kg (RMB 4.84 = AUD$)
Slaughter cattle prices have remained steady with the slight reduction in the AUD price above due to currency movements only. Beef prices in both wet and supermarkets are very erratic with no pattern to follow as beef and pork prices go both up and down in Beijing and Shanghai during December. This level of market disruption is not surprising given the massive movements in supply and demand for all proteins as new outbreaks of ASF continue to appear while the Chinese government is scouring the world searching for additional sources of every sort of protein. Almost every week there is an announcement in the press of a new deal being signed opening up access for another country to export products into China. The coming Chinese New Year festival period which runs from 24th to 30th of January will only put further strain on overstretched supply chains.
Philippines : Slaughter Cattle AUD $5.27 / kg (Peso 35.1 to AUD$1)
No change to the high prices for slaughter cattle in the Philippines as the domestic economy continues to charge along with low unemployment, strong demand and supply for food at steady prices so everyone can enjoy the new level of prosperity.
The Philippine authorities appear to be doing a good job of restricting the spread of ASF which is still limited to the original outbreak area in Luzon. Since the first confirmation on 25th of July there have been a total of 24 ASF outbreaks in 9 provinces of Luzon Island. As of the end of November 136,000 pigs had been depopulated.
Thailand : Slaughter Steers AUD $4.78 / kg (Baht 20.9 to $1AUD)
Thai prices have increased sharply this month on the back of the promise of the new demand from Kunming. This has also resulted in a lift in the beef prices in the local wet markets. The potential demand from Kunming is huge so if this market gets going it will change the face of the Thai beef industry.
Thailand continues its combination of good management and good luck as it is one of the few countries which remains free of ASF.
I visited Ethiopia during late November. It is a very beautiful place but I was surprised by the primitive state of their domestic agricultural systems. See below the method of threshing the grain using heavy bulls walking in circles over the harvested grain straw which is then thrown into the air with wooden forks to further separate the grain from the chaff.
These figures are converted to AUD$ from their respective currencies which are changing every day so the actual prices here are corrupted slightly by constant foreign exchange fluctuations. The AUD$ figures presented below should be regarded as reliable trends rather than exact individual prices. Where possible the meat cut used for pricing in the wet and supermarket is Knuckle / Round.
Photo : Ethiopia has Africa’s largest cattle population at about 55 million head. This is a weekly sale on the side of the road in the northern regional town of Mekele near the border with Eritrea. Bulls (guess 350 kg) in this market were selling for about Birr19,000 or around 54Birr per kg = AUD$2.44 per kg live weight. Given a combination of the translation difficulties and the reluctance of any traders to tell tourists their real prices this rate may be well off the mark.
Beef in the local butcher shops/restaurants was selling for Birr240 per kg or AUD$10.77.