Brief History of the Industry

Australia is the largest exporter of quality livestock in the world, exporting around 900,000 cattle and 6 million sheep annually. Approximately one third of the cattle exported from Australia are through the Port of Darwin, making Darwin the busiest livestock port in the world today.

Darwin is ideally situated to supply the markets of Indonesia, the Philippines and the rest of SE Asia. Northern Australia is home to large numbers of tropically adapted cattle ideal for fattening in South East Asian feedlots. The trade is facilitated by the fact that Australia has a disease free herd.

The imported Australian cattle are fed on the abundant supplies of agricultural bi-products available in the importing countries. In doing so, Australian cattle are able to be value added while at the same time enhancing domestic employment opportunities.

During the 1980s and particularly the 1990s, significant markets were developed in Indonesia and the Philippines in particular, as sophisticated modern feedlots were developed. This growth was linked with rapid economic development in these economies, and was also a reflection of their Government's desire to increase protein consumption.

In order to forecast for the future, we must look at the past and present a picture of the industry as it has evolved both in northern Australia and South East Asia. Many factors have affected the rise and fall of some of our key markets, which the industry has been able to both capitalise on and retreat when necessary.

Historical Timeline
1970s

• modest numbers of breeder cattle to Indonesia
• small numbers of breeder and slaughter cattle to Malaysia and the Philippines.

1980s

• breeders to Indonesia gradually tapering off
• shipments to Malaysia growing due to increasing wealth and government policy
• brief surge of breeder exports to Thailand
• shipments to the Philippines beginning to grow as the country's economy benefits from increased foreign exchange earnings from guest workers repatriating wages from all over the world.

1990s

• Powerful growth in both breeder and feeder cattle exports to the Philippines Indonesia begins low level imports
• The first Gulf War in 1992 reduces the income of the Philippines and exports come to a sudden halt
• Indonesia uses this opportunity to gradually increase their importations
• Indonesian imports rise dramatically to exceed 500,000 per year and the Philippines also becomes active again
• Australia briefly tries to develop a trade with Vietnam but fails to maintain it
• The Asian Financial Crisis in 1997 slows all exports to South East Asia for a about two years
• Egypt briefly becomes a significant customer because prices of Australian cattle are so low and shipping rates have collapsed.

2000s

• Innovative financing techniques and the rising price of Indonesian beef allow exports to Indonesia to restart at low levels. At the same time, Indonesian entrepreneurs develop highly efficient feeding systems, allowing for significant value-adding to imported livestock
• The level of Indonesia's imports increases in tune with the country's economic recovery
• All other South East Asian markets remain very weak
• The Global Financial Crisis fails to affect the Indonesian demand which continues to climb
• The Muslim religious festival, Ramadan, has been a major factor influencing demand for beef, and consumption has spiked.