Lift of China processor ban will deliver major value for Australian red meat sector

Last week five out of seven Australian processors that had been locked out of the market had their export approvals reinstated, a move which came six months after three processors had their COVID-19 suspensions lifted.

MLA's general manager for international markets Andrew Cox said it was great news for the industry and opened the way for new market growth.

"It's hard to quantify the exact economic benefit because the market's probably changed a little bit and our industry adjusted to the suspensions but conservatively the value is in the hundreds of millions," he said.

"We have some internal modelling from the time which suggests thus.

"The immediate impact of course is for those five plants that have been reinstated but there's a flow on effect of course, there's a number of other companies that were contracting those plants to process beef for the China market.

"More importantly the news is evidence that the trading relationship between Australia and China is improving and therefore we could hope to see further good news.

"There are two plants that are still suspended and there's quite a large number of plants that are actually waiting for access to China, probably around 20 plants."

Mr Cox said access for chilled beef and sheepmeat was still fairly restricted and MLA was looking to facilitate that moving forward.

"There's also restrictions on offal exports for Australia, Chinese demand for beef offal products is quite high and there are products that have higher demand over there than in Australia like tongue, tripe and tendons that are quite restricted so plants are hoping to see some progress on that as well," he said.

Mr Cox said there had been chatter about the possibility of the approvals being reinstated but ultimately the timing came as a welcome surprise and coincidentally came days prior to an event promoting Australian red meat that was held at the Australian embassy in Beijing.

"It's a positive for the specific plants that have been reinstated but across the whole of industry including primary producers you can't see this news as anything but positive," he said.

"It's all a sign that things are heading in the right direction, there's been a huge amount of work from industry and government on this.

"The Chinese market, like a fair few other markets is currently not exactly firing on all cylinders so market conditions are a little subdued... we're not expecting to rapidly, drastically increase beef exports to China but long-term China represents tremendous opportunities for Australia.

"We've got fantastic customer relationships, fantastic consumer relationships and a great reputation in China for supplying nutritious and safe foods so we can continue to build on that foundation."

Mr Cox said even though conditions were more subdued at the moment, the market was cyclical and there were significant economic development opportunities.

"Look back to 10 years ago, China was not even on the board when it came to beef exports and now it's our largest market for red meat and it's the largest protein market in the world by far," he said.

"While the market conditions may fluctuate up and down year by year, there are long term opportunities to entrench Australian produce in China in people's hearts and minds."