PRODUCTION of lower-value offal is being traded off as beef processors are forced to make decisions about where to direct scarce labour resources.
On top of the general cattle shortage, the situation means volumes of Australian offal available for export are at historic lows at a time when global demand is growing.
Market analyst with Meat & Livestock Australia Jenny Lim said beef coproduct sales were increasing as consumers looked for alternate options as retail beef prices went up.
Australian processors were opting to focus on cheek meat, head products, tendons, foetal blood and tallow, which were commanding the higher prices, she said.
Products that are particularly labour-intensive, requiring speciality boning or cleaning procedures, such as hearts an aortas, along with halal products which require specialty treatment, were now often being sacrificed, Ms Lim reported.
MLA's September coproducts price report shows head meat, cheek and tendon prices have firmed.
Cheek meat jumped 22 per cent on the previous month to average $11 a kilogram free-on-board at Australian ports, while head meat was up 38pc and tendons were up 44pc.
Head meat averaged $7.05/kg which was $1.95/kg higher year-on-year. Cheek meat was $2.61/kg dearer than the year-ago levels.
Lip export prices to the United States and Mexico also firmed, averaging $4.95/kg to be 18/kg up on last year.
Ms Lim said cheek meat had become a speciality in many markets, including in Australia, when cooked 'low and slow'.
"This is definitely an example of people looking for options other than prime cuts. Cheek meat demand has been growing for two years now," she said.
Tallow, despite being a labour-intensive product to process, was also seen as a better option, given the returns available on the global market on the back of biofuel demand, Ms Lim said.
Singapore and the US in particular are paying strong prices for tallow.
The coproducts report showed all rendered products remained buoyant. Blood meal averaged $1273/tonne, up $266/tonne compared with last year's price.
Ms Lim said pharmaceutical products, particularly foetal blood, were also high on processor's lists, commanding strong values given there is far less of it on the market.
The average foetal calf blood price has firmed $109.67/litre year-on-year to average $616.67/l, which was $3.34 up from last month.
Hides
Prices for hides have been steady across the board and remain under strong downward pressure.
After a short-lived resurgence last year, all categories are back, although not quite to the rock bottom levels they were. Smaller ticky Queensland hides have been the worst hit, back more than 70pc year-on-year.
Some hides are making as little as $3 each ex-works.
Last year's resurgence in hide prices appears to be a reaction to more activity in the upholstery and automotive sector as demand bounced back after the pandemic. Combined with a shortage of cattle around the world, it pushed prices up significantly for a short time.
Shan Goodwin
Shan Goodwin steers ACM’s national coverage of the beef industry. Shan has worked as a journalist for 30 years, the majority of that with agricultural publications. She spent many years as The Land’s North Coast reporter and has visited beef properties and stations throughout the country and overseas. She treats all breeds equally. Contact 0427686187. E: s.goodwin@austcommunitymedia.com.au
Shan Goodwin steers ACM’s national coverage of the beef industry. Shan has worked as a journalist for 30 years, the majority of that with agricultural publications. She spent many years as The Land’s North Coast reporter and has visited beef properties and stations throughout the country and overseas. She treats all breeds equally. Contact 0427686187. E: s.goodwin@austcommunitymedia.com.au
