Australia: Global demand is there, and we have the cattle, but can processors keep up?

Demand for Australian beef is expected to rise in the second half of 2024 due to a decline in United States production. Processor capacity will be the key factor in meeting this demand, with some plants already at maximum capacity and others showing signs of chasing more livestock. Despite this, significant growth in beef production in Australia is not expected. However, Australia's beef shipments to the US have seen an 85% increase compared to last year, and declining US volumes to Japan and South Korea have led to an increase in Australia's exports to these countries. China's removal of suspensions on plants and granting of additional licences is expected to add more competition. Overall, the first half of the year saw stable beef production in Australia, with increased slaughter volumes and export shipments above the quarterly five-year average.

With demand for Australian beef tipped to increase in the second part of 2024 on the back of declining United States production and all signs pointing to producers having more cattle to sell, at least until Christmas, the linchpin is clearly going to be processor capacity. Across the country, extra shifts have already been added to cater for larger volumes of cattle. Slaughter volumes are travelling around 30 per cent above the five-year average. Reports are now flowing through that capacity in northern plants is close to, if not at, maximum. Some centres are believed to be booked out months in advance. In the south, where substantial extra capacity has come online in the form of expansions at numerous plants, processors are showing signs of chasing more livestock to ramp up their ability to meet the global demand. Producers say direct consignment grids have lifted and agents report southern processors are venturing well into Queensland chasing supply. However, analysts believe ...