INDONESIA'S focus on food security is more likely to work in tandem with Australia's livestock export trade than against it.
That message came through during panel discussions at the live export industry's annual conference, LIVEXchange, in Townsville this month.
The future is looking very bright in Australia's number one cattle market, particularly given the growing demand for quality in beef from Indonesian consumers, exporters and those working in-market reported.
The latest monthly trade summary shows cattle exports to Indonesia are sitting at just over half a million head for the calendar year to the end of September, up 20 per cent year-on-year.
That accounts for more than half of Australia's total cattle exports. Feeders make up by the far the largest proportion to Indonesia.
Frozen boxed Indian buffalo meat created some angst for Australian producers when Indonesia allowed it to be imported in a bid to boost the accessability, and affordability, of red meat to its people.
For the past three years, around 150,000t of IBM per year has entered the market.
However, there had been little displacement of Australian beef in that time and cattle imports had grown, Meat & Livestock Australia's Singapore-based market analyst Tim Ryan said.
"Manufacturing beef is probably where there has a bit more overlap but overall the market is so under-serviced that any additional product going there is easily consumed," he said.
There was enormous potential for beef consumption growth in Indonesia, the conference heard.
The Indonesian consumer was fast becoming more sophisticated and looking for greater quality, MLA's country manager for Indonesia, Valeska, said.
"Australian cattle stand for fresh, food safety, locally-produced. These are attributes where Australia has a real point of difference in Indonesia," she said.
"Beef is a key protein in Indonesia. As demand grows, competitors like IBM will fill the bottom of the pyramid."
The trade with Australia, she said, was no longer just transactional. Australians were much more integrated in the supply chain and that was looked on positively in terms of Indonesia's self-sufficiency ambitions.
Broken down into the different provenances where beef was produced, self-sufficiency already existed, Valeska said.
"Where Australian cattle are coming in, they are complimenting local beef production," she said.
"We understand Indonesia's food security objectives. Affordable and accessible protein for the people is something every country wants.
"At the end of the day, having Australian cattle go over is about providing consumers with more choices. It is part of the food security agenda."
Queensland Livestock Exporters' Association president Greg Pankhurst said Australia supplied just 20pc of the total beef requirement in Indonesia, with around 121,000t coming from live animal production compared to the 640,000t consumed.
Consumption sits at just 2.4 kilograms per person per year.
"We only need to see that go to 3kg and it's another half a million cattle from us," he said.
"IBM volumes are not increasing but Indonesians are very keen to form partnerships so they can look at other options to produce the beef they need."
Policy introduced this year requiring Indonesian importers to ensure a minimum of five per cent of their volumes are breeder cattle in order to obtain a feedlot licence was part the government's food security aspirations, Valeska reported.
Managing director of Halleen Australasian Livestock Traders Ian Halleen said there were concerns about the viability of smaller breeder operations being promoted by the Indonesian Government as they did not have the extension services to back them up.
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