Live Export of Cattle Industry in Australia Report

This report analyses the current business performance of the Australian live export of cattle industry and market opportunities available for this type of Australian cattle business in international market. It covers market intelligence about the cattle industry, current business performance and opportunities in international market, trends and developments that affect the industry, future opportunity and threats for this industry in international market, forecast about international market and business needs, and recommendations.

Running Head: Cattle Industry in Australia
Live Export of Cattle Industry in Australia
Report
System04104
7/18/2019

Cattle Industry in Australia
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Table of Contents
1. Introduction.........................................................................................................................2
2. Market intelligence about the Cattle Industry.....................................................................2
3. Current Business performance and opportunities in international market.........................4
3.1 Trends and developments that affect the industry............................................................6
3.1.1 Cultural Factors..........................................................................................................6
3.1.2 Socio-Economic Factors............................................................................................6
3.1.3 Ecological/Environmental Trends.............................................................................6
3.1.4 Economic Trends.......................................................................................................7
3.1.5 Technological impact.................................................................................................7
3.2 Future opportunity and threats for this industry in international market..........................7
4. Forecast about international market and business needs....................................................8
5. Recommendations...............................................................................................................9
6. Conclusion..........................................................................................................................9
References................................................................................................................................10

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1. Introduction
In last 35 years, the Australian live export of cattle trade has played a significant role in
Australian cattle market. The most important thing is that it is continuously contributing in
Australian economy and providing huge employment opportunities to local Australian people
(LiveCorp, 2018). This report helps to understand the current business performance of this
business industry and analyse that what are the market opportunities available for this type of
Australian cattle business in international market. Further, this report analyses the
international market and business needs for the live export of cattle in international market.
2. Market intelligence about the Cattle Industry
The live cattle export majorly contributes in the economy of Northern Territory and North
of Western Australia (Howden, Nelson & Zammit, 2018). These regions are also suitable for
cattle industry production and provide perfect environment for fatten cattle and breed cattle.
However, according to an analysis, it has been found that 40-575 revenue generated by
farmers is retained by them. According to the stats related to live cattle export in Australia,
more than 1,095,325 heads of live cattle are exported every year to various countries
(LiveCorp, 2018). The export value of the traded cattle is $1.2 billion while $620 million
revenue retained by the farmers in the country. There are 23 destinations countries where
these live cattle are exported including Indonesia (53%), Vietnam (16%), China (8%) are the
major importer of these cattle (LiveCorp, 2018).

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(Source: LiveCorp, 2018)
(Source: LiveCorp, 2018)

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QLD is the major contributor in the domestic processing of live export of cattle, which
contributes 46% followed by NSW (22%), VIC (19%), and WA (5%). However, NT’s export
is more than 38% to other countries (LiveCorp, 2018).
3. Current Business performance and opportunities in
international market
The company is exporting more than 1,000,000 head of cattle every year but in last two
years (2017 and 2018) it was around 889,525 and 473,620 cattle (Meat and Livestock
Australia, 2018). However, the major causes behind decrease in export was a significant
decrease in the international demand of live cattle and increasing mortality rate of these
animals in the country, which is rise every year (Ryan, 2017)). In 2018, the mortality rate of
cattle was 0.14% and it was a big upset for this industry.
(Source: Pahantus, Amruzi, Dessy & Didik, 2017)
However, it has been clearly seen in the below bar graph that the export has been
decreased after 2014. During this period, it is clearly shown that draught and elevated cattle
slaughters are the major reasons of decreasing export of cattle (Buddle & Bray, 2019). The
industry see the reduction in overall gross value of live cattle exports in the country and it is
also causes because of slow down in beef production industry. This negative growth rate for
the industry is a serious concern for the Australian beef and live cattle export industry,

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because it creates huge employment opportunities for the regional people in Australia. The
table show the decreased trend of live cattle export in Australia from 2014 to 2018 (Sinclair,
Derkley, Fryer & Phillips, 2018). It has been clearly shown that the number of headcounts of
live cattle export was decreasing after 2014 and the major causes were slow down in beef
product industry and increasing mortality rate in cattle.
(Source: Coleman, 2018)
According to a research conducted Mercado qualitative, it has been observed that the
Northern Territory and Western Australian participate with high proportion in the live export
of cattle in Australia. However, the five key live cattle export destinations (according to the
value of export) for Australian cattle industry are Indonesia (42.3%), Vietnam (14.5%), China
(15.7%), Israel (6%), and Turkey (6.7%) (LiveCorp, 2018). Among these five countries,
Vietnam is known for its beef industry products and Vietnam consumes more beef for their
domestic and international beef production (Coleman, 2018).
3.1 Trends and developments that affect the industry
There are various international trends that affect the Australian live export of cattle.
These trends can be covered under the following points:

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3.1.1 Cultural Factors
Religion and Tradition: The Middle East region like Turkey, Indonesia, Israel, and
other Islamic countries are the main regions for the export of live cattle because they drive
the consumption of beef and red meat products (Moore, Madin, Norman, & Perkins, 2015).
The religion is most significant factor on cattle export because the religion determines the
supply chain practices of the industry (Sinclair, Derkley, Fryer & Phillips, 2018).
3.1.2 Socio-Economic Factors
Regional Employment: Cattle industry provides huge employment opportunities for
people in Australia. Apart from this, the export activity of cattle adds additional work or
employment opportunities for local people. For example, transport of cattle needs additional
vehicles and work force to supply the cattle from one country to another country
(Pendergrast, 2015).
Demographic trends: The larger market for the beef products is Middle East region,
where normally Islamic countries prefer to consume beef. However, in other countries where
people avoid the consumption of beef cannot be considered as the potential market for the
live cattle export (Moore, O’Dea, Perkins, & O’Hara, 2015).
3.1.3 Ecological/Environmental Trends
Draught and adverse environmental conditions adversely affect the demand of cattle
products. The natural disasters like flood or draught may affect the life of cattle and it is
directly related to export of cattle. Apart from this, if large numbers of cattle are dying every
year, Australia cannot supply the required number of cattle with their key partners (LiveCorp,
2018).
3.1.4 Economic Trends
People are now more conscious about their income and expenditure. The national or
international economic trends in cattle industry affect the business very less. However, the
low cost meat source attracts the people who love to consume beef or pork products (Meat
and Livestock Australia, 2018). The cost advantage over the beef products affects the demand
of cattle exports. However, Australia charge very high cattle processing cost in the world in
compare to its competitors Brazil and USA. Australia charges $360 for one beast, USA
charges $290 and Brazil charges $172 in the Middle East and Asian countries. However, the
cost of the beef products also determines the amount of export of cattle (Dong, Waldron,
Brown & Zhang, 2018).

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3.1.5 Technological impact
The advancement in technology also affects the export of live cattle export and even it
effect the demand of beef processing foods. Advancement in technology can help to process
beef products more easily and keep the beef product for long time in the storage. Countries
that import the live cattle can also focus on co-products, thus they can take the value of co-
products while they processing the beef or red meat products.
3.2 Future opportunity and threats for this industry in international
market
The major problem for this industry is future challenge from its competitors and
decreasing demand of such products from last few years. However, these issues and
challenges can be faced by following actions:
1. Cooperative Ventures: Australia can open or tie with other local firms such as in
China, Israel, and Turkey to take the live cattle for fresh beef processing foods and
consume it in the local market. Apart from this, it will also help in increase the
demand of such products in the business partner countries.
2. Joint Venture: Australia can also open the joint venture in those Islamic countries
where beef consumption or red-meat consumption can be increased in future with
little efforts. Australia can also encourage people to consume the beef products
because it will directly increase their export of live cattle.
3. Changes to competitor’s business operations: Australia should look for the
business model of its competitors. China is one of the populous countries and
followed by India and Brazil. A heavy competition in the Middle East and Asian
countries can affect the export volume of Australia (Gebrekidan, Nelson, Smith,
Gasser & Jabbar, 2017).
4. Forecast about international market and business needs
The Australian cattle industry can use these three forecasting techniques to forecast the
future market and business needs for the Australian live cattle export:
1. Top Down Forecasting:
This forecasting approach helps to understand the different factors at both national and
international level, which can boost the export of live cattle. This technique includes research

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about the GDP of a country, spending pattern of people, to identify the choice of customers,
and government expenditure and support. These information help to forecast the future
market demand and opportunities for Cattle export (Dong, Waldron, Brown & Zhang, 2018).
2. Bottom-up Forecasting
This forecasting technique helps to understand the demand of consumers. This forecasting
technique helps to know what people wants to buy and what are their needs. Such forecasts
are based on surveys and samplings. This technique can also be accomplished through
various telephonic interview and online survey in different international market.
3. Survey of Intention Technique:
This techniques helps to understand the intention of customers that what they want in a
potential market. If the demand of beef processing products will be increase in the country,
the demand of live cattle will be automatically rise. This is also a crucial method for
forecasting the opportunities and business needs of a particular market.
5. Recommendations
On the basis of above analysis, there can be following recommendations for the
Australian live cattle export industry.
1. The government should first analyse the demand of live cattle and target those
potential market where demand of beef products is increasing.
2. Islamic countries are the major promoter of beef products. Therefore, the cattle
industry should look towards the Middle East countries like UAE, Iran, and Iraq etc.
3. The Australian cattle industry should also review their cattle export processing
charge, which is too high in Asian market in compare to USA and Brazil.
6. Conclusion
In conclusion, the Australian cattle industry should look for the key reasons behind this
issue and it will be better that they adopt adequate forecasting technique to analyse the future
demand of beef products and demand of live cattle in its export partner countries. The
Australian cattle industry should also focus on those potential markets such as Arab, Iraq,

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China, etc. where consumption of beef products are gradually increasing and it may provide a
great opportunities for cattle industry in international market.

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References
Buddle, E. A., & Bray, H. J. (2019). How Farm Animal Welfare Issues are Framed in the
Australian Media. Journal of Agricultural and Environmental Ethics, 1-20.
Coleman, G. (2018). Public animal welfare discussions and outlooks in Australia. Animal
Frontiers, 8(1), 14-19.
Dong, X., Waldron, S., Brown, C., & Zhang, J. (2018). Price transmission in regional beef
markets: Australia, China and Southeast Asia. Emirates Journal of Food and
Agriculture, 99-106.
Howden, M., Nelson, R., & Zammit, K. (2018). Australian agriculture overview. Agricultural
Commodities, 8(2), 11.
LiveCorp (2018). Value analysis of the Australian live cattle trade - key highlights November
2018. Retrieved from: http://www.livecorp.com.au/LC/files/c7/c77c998a-3a23-47e0-
bd98-4d33dfe78c91.pdf
Meat and Livestock Australia, MLA (2018). Industry projections 2018: Australian Cattle.
Retrieved from: https://www.mla.com.au/globalassets/mla-corporate/prices--
markets/documents/trends--analysis/cattle-projections/mla_australian-cattle-industry-
projections-2018.pdf
Moore, S. J., Madin, B., Norman, G., & Perkins, N. R. (2015). Risk factors for mortality in
cattle during live export from Australia by sea. Australian veterinary journal, 93(10),
339-348.
Moore, S. J., O’Dea, M. A., Perkins, N., & O’Hara, A. J. (2015). Estimation of nasal
shedding and seroprevalence of organisms known to be associated with bovine
respiratory disease in Australian live export cattle. Journal of Veterinary Diagnostic
Investigation, 27(1), 6-17.
Pahantus, M., Amruzi, M., Dessy, A., & Didik, S. (2017). The Impact of the policy on the
imported beef from Australia and the production of domestic beef. Russian Journal of
Agricultural and Socio-Economic Sciences, 65(5).

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Pendergrast, N. (2015). Live animal export, humane slaughter and media hegemony. Animal
Studies Journal, 4(1), 99-125.
Ryan, E. (2017). A Tale of Three Cities: A Comparative Analysis of Newspaper Coverage of
the 2011 Live Cattle Export Suspension. GEO View: Online Undergraduate Review
of Geography and Environmental Studies.
Sinclair, M., Derkley, T., Fryer, C., & Phillips, C. (2018). Australian public opinions
regarding the live export trade before and after an animal welfare media
expose. Animals, 8(7), 106.
Sinclair, M., Derkley, T., Fryer, C., & Phillips, C. (2018). Australian public opinions
regarding the live export trade before and after an animal welfare media
expose. Animals, 8(7), 106.