Strong ties rebuild live-ex

06 Apr, 2013 03:00 AM
SEALS managing director John Kaus, Indonesian Society of Animal Science president Mr Yudi Noor, Indonesian coordinator Rahi Agustar, and SEALS manager Dean Ryan.
SEALS managing director John Kaus, Indonesian Society of Animal Science president Mr Yudi Noor, Indonesian coordinator Rahi Agustar, and SEALS manager Dean Ryan.

WHILE industry is still reeling from the impacts of the suspension of live cattle exports to Indonesia in June 2011, the hasty political decision has failed to break the strong bond between industry members in Australia and Indonesia, forged over almost 30 years of collaborative hard work.

And the industry’s future remains economically sound due to mutually beneficial synergies gained through complementary production systems and Indonesia’s escalating appetite for Aussie beef.

That’s the view of Indonesian Society of Animal Science president Mr Yudi Noor and senior members of South East Asian Livestock Services (SEALS).

Mr Yudi Noor attended the Northern Territory Cattlemen’s Association conference in Alice Springs last month on an Indonesian delegation that was warmly welcomed.

He signed a Memorandum of Understanding (MoU) with the NTCA to continue the Indonesia Australia Pastoral Industry Student Program.

The NTCA initiative was launched last year and provides an eight and a half week rigorous learning schedule in the north Australian cattle industry for Indonesian university students studying animal husbandry.

Mr Yudi Noor spoke to Fairfax Agricultural Media about the significant economic and social challenges that have confronted the live export industry over the past two years.

He snapped his fingers and shook his head slowly when describing how the Australian government “stopped live exports in just one night”.

Mr Yudi Noor said the narrow perception of Indonesia’s abattoir practices that underpinned the ban were out of touch with reality and reflected only a small portion of the entire industry.

He said significant advances have been made in animal welfare practices over 30 years of being in business together with Australia, which failed to gain acknowledgement during the emotive events that sparked the trade’s month-long closure.

Mr Yudi Noor said industry had to work together in sending positive messages to politicians and the broader community that the live export trade “is a very good business with lots of mutual benefit for our two countries”.

“We’ve had problems in the last two years and we have to fix that but over the past 20 or 30 years our relationship is very good and the rest of society doesn’t understand that,” he said.

SEALS managing director John Kaus said the Australian government’s snap ban created problems for the entire live exports supply chain, from producers through to transporters, exporters, feedlots and abattoir workers in Indonesia.

When the ban first hit Mr Kaus estimated it cost his company $3 million which had exported 20,000 head of cattle the year before but only 5000 head in 2011.

“Everybody copped a very heavy loss from the ban,” he said.

“But lucky there’s a very, very strong relationship between industry that’s been built up over many years here in Australia and with the Indonesians.

“The bridge has been broken at government level but not between the industry and that’s why we’re looking forward to a strong future.”

In the wake of the ban, the Indonesian government cut import quotas from 520,000 in 2010 to 410,000 the following year.

Indonesia then slashed the quota to 283,000 in 2012 and announced plans to move towards beef self sufficiency along with other key food commodities.

The 2013 beef quota is 80,000 tonnes, or 238,000 head of cattle and 32,000 tonnes of boxed beef to be exported from Australia.

Mr Kaus remained positive about the future outlook saying “the government in Indonesia can do what they like with the quota numbers but I’m sure they’ll come back just as strong”.

“We’ve been through the global financial crisis and batted that away, which was easier to handle than what the government did with the imposition of Exporter Supply Chain Assurance system (ESCAS) and the ban on cattle exports to Indonesia,” he said.

“One positive is that ESCAS has lifted the standards in all countries that are importing Australian cattle but it has come at a huge cost for us.”

SEALS manager Dean Ryan said estimates that ESCAS was costing producers an

extra $20 per head were conservative.

Mr Ryan said producers were also wearing the costs of decreased local demand and increased supply since the ban, with the farm gate price falling 60c per kg.

“For a 300/kg steer that’s $180 per head, so if you’re selling 10,000 steers a year it puts a fair hole in the budget,” he said.

“And that’s what’s making these big commercial cattle operations in northern Australia unviable.

“They’ve invested their whole lives and blood, sweat and tears into making sure we’ve got a product to sell and the Indonesians have an end product.

“But to stop that all overnight is quite frightening.”

Mr Yudi Noor said some short term politics had to be overcome in Indonesia leading up to an election next year, but the big picture remained unchallenged.

He said Indonesia currently had 250 million citizens and 150 million of them with middle class incomes, growing by 6.8 per cent per year.

They’re also increasing beef consumption, he said, even though beef prices have increased rapidly since the ban due to decreased cattle supplies.

Mr Yudi Noor said beef was now a big part of Indonesia’s lifestyle.

“There’s still a buyer for beef even though prices are high - the demand is there the market is there,” he said.

“We understand Indonesia has to increase beef self sufficiency but there’s sustainability with live exports and we can all grow together.

“The system is good – Australia has a cheap production system for breeding the animals and Indonesia has a cheap production system for fattening the animal and that’s the mutual benefit.”

Mr Yudi Noor said if Indonesia increased beef consumption by 1kg per year per head of population, it would require an extra 250,000 tonnes per year.

And according to Indonesian Trade Minister Gita Wirjawan’s aspirational goal, to increase beef consumption from 2kg to 20kg per person per year, the potential added beef demand “is huge”.

Mr Kaus said the ban “bruised the live export business” and recovery would “take a while” but he remained confident that the future was positive.

On the healing of political relations, he said Opposition Leader Tony Abbott was welcomed on his visit to Indonesia last year with Shadow Trade Minister Julie Bishop and Shadow Agriculture Minister John Cobb, “more than any of the government ministers”.

Mr Ryan said the perception of live exports had to continue changing with more positive communication from industry about the positives.

“We’re a clean hard working industry and some of the public’s perception, that we’re a dirty cruel industry, is a long way from the truth,” he said.

Date: Newest first | Oldest first


Jen from the bush
6/04/2013 12:48:18 PM

12 out of over 800 slaughterhouses were not up to standard. These slaughterhouses did not kill all that many cattle. Meanwhile in au, nearly 100,000 dogs and cats are abandoned to starve and be put down or kill our ecology. Hypocrites To do so much damage to au farmers when you are all so guilty yourselves. Cost of kill in au is $350/hd, USA is $150 and Asia is $35. Au is high mainly due to huge union demand and high wages. Hypocrites again to do so much damage to farmers while you demand high wages.
7/04/2013 9:40:57 AM

How embarrassing that the government of our nation could be so childish and irresponsible to have caused so much damage to appease the sensibilities of a handful of irrational lunatics with obvious social and psychological problems. No other nation would have contemplated such a shocking action against so many people, depending on us to supply food, on evidence from such a questionable source. When Tony Abbott is prime minister he must apologize on behalf of Australia and our misfortune of the previous governments rash gullibility and poor ethics. It is time to heal our nation.
Trevor Johnston
7/04/2013 4:38:47 PM

Cattle were fist exported to Indonesia in 1866 then again in 1884 from the NT, while official statistics show that Indonesia was second only to the Philippines as a live cattle export destination from 1899 through to the early 1930s. Exports ceased between 1933-34 and 1971-72, but from 1981-82 and beyond, Indonesia has been among the top three customers for live cattle exports.
8/04/2013 1:06:35 PM

The unstoppable necessities of life for so many people, was always going to roll over the childish and ignorant like the " nothing " they contribute. A time will come when it will be illegal to plot against, or interfere with the production of food. It is time to campaign for a muzzle to be put on activists. They have cost our economy 100's of million' of dollars. They contribute nothing but their fanatical discrimination.
8/04/2013 3:06:48 PM

Good work gabriel,those responsible for this mess should be made to see 1st hand the disaster in cattle prices unfolding in the saleyards of western QLD but i believe they have flitted off to china on a trade misson.
10/04/2013 6:51:30 AM

I received good rain but still had to throw away some good steers to meet the interest payments. Sitting it out now so the other poor buggers can get processed. Yes, what an irresponsible mess.


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Correct Jock. Selling what you don't already have is the biggest con ever introduced to
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When good systems do not deliver, "wheat grower for 53 years", it is caused by either the
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Totally agree "Wheat grower" , growers need to step up and elect a professional board who are