WITH supply showing some glimpses of improvement in June and there being 22 working days in the month (less the Queen's Birthday holiday in some states), it was expected that beef exports would nudge above 80,000 tonnes for only the second time so far this year.
However it was not to be.
The cyber-attack on JBS global operations resulted in significant downtime for that company's Australian plants with the result that total Australian export volume for the month was only 73,551t.
That is 23,000t below same month last year and the lowest June tonnage by far in the past 10 years.
It also takes the cumulative half-year total to 422,412t, down 24 per cent on last year's first half and again a seriously low figure historically.
First-half results in the past 10 years peaked at 647,000t in 2015 and with the exclusion of 2021 averaged 538,000t.
But as we saw in the herd-rebuild years of 2011-2012, that is what happens when the cow supply dries up.
However it is a very rare drought event that affects everyone to the same extent and usually there are some regions that have fared better than others and allowed herd numbers to remain relatively intact.
North-west Queensland seems to be one such area with recent reports from at least one major processor of plenty of cattle (principally cows) being put up to them in the past month to six weeks.
It seems there may be quite a spread on the progress of first-round musters with many already completed or well advanced while others are less advanced due to the time taken for country to dry out.
In terms of pulling slaughter cattle out of the north-west, rail has always been the preferred method of transport for meatworks on the east coast but for obvious reasons it is not an attractive option for works located on the Downs.
Road is more direct but requires breaking of triple road trains en route into smaller units.
A combination of road and rail therefore represented an improvement on existing options and was presumably put forward as a contributing argument in support of the proposal for the Morven freight hub which opened last September.
But a visit in May to what is a very impressive facility showed little evidence of much usage.
Since then there has been one sizeable consignment of mostly cows from Julia Creek which has at least confirmed the road/rail combination through Morven as a practical option for sourcing cattle from central and north-western parts of the state.
Whether Morven goes on to be a logistics success remains to be seen but it may hinge to a considerable extent on increased supply through long awaited herd rebuild in affected western areas and that may take some time.
Meanwhile Australia's offerings of lean beef into global markets continue at a diminished level.
Just 12,178t went to United States ports in June compared to 26,000t in the same month last year.
For the half year, exports to the US amounted to 65,295t down a whopping 49,000t or 43pc on first half 2020.
In the past 20 years the lowest annual volume to the US was 167,000t in 2011 compared to the high point of 416,000t in 2015.
Current indications are that 2021 volume will be well under the 2011 low point.
Volume into China is little different to the US with 11,769t in June and a cumulative half-year total of 72,153t.
Given Australia's current limited capacity to supply lean beef, it seems little will change in the immediate future in terms of relative volumes going to these two markets.
It might have been thought that reduced supply from Argentina to China could lead to China buying product away from the US but so far this is not reflected in the Australian export figures.
In other markets, Japan and Korea are showing considerable resilience.
June volume to Japan was 21,000t which is only marginally down on current and previous year volumes.
At the half-year mark, Japan is down by 19pc on last year but that is steadily improving and by year end the variation should be no more than 11-12pc down.
Korea, on the other hand, is a stand-out performer.
For the past three months volume to this market has kept the year-to-date figure ahead of previous year.
June volume of 12,480t was marginally down and brought the half-year position into deficit but by a margin of less than 2pc.
At current indications the end-of-year position should be down by no more than 3-4pc on previous year.
Rain interrupts supply
WHILE not a traditional time of year for seriously good falls of rain, parts of central Queensland have welcomed it nevertheless and the benefits will show when the weather warms up later in the year.
Cattle supply was interrupted to some extent, requiring a bit of juggling on the part of livestock managers but no time was reported as lost.
For the moment there appears to be a reasonable flow of cattle coming through to works and full five-day shifts are being maintained but processors are wary about how well August/September will shape up.
Rates meanwhile remain largely unchanged across all the major players.
In south-east Queensland, four-tooth ox range from 655-690c/kg while heavy cow remains at 610-625c/kg.
For similar ox and cow descriptions Wingham is showing 650-620, Wagga 695-620 and Naracoorte 695-640.
Overseas, Steiner's latest US report focuses on the decline in demand for domestic rib and loin steak cuts which is pushing retailers toward cheaper cuts and ground beef, resulting in a strengthening market for domestic lean.
Domestic 90CL gained a further US3c/lb on top of a similar rise the previous week taking the latest quote to US281c/lb.
While this puts imported 90CL at a slight discount to domestic at the moment, Steiner believes there is upside ahead for the imported product and reinstatement of traditional premium over domestic product.
