Australia-Meat Boss praises low Australian dollar.
THE slide in the Australian dollar from almost parity last year to the mid US60 cents range should keep Australian beef competitive in 2009, according to Teys Brothers executive director livestock Geoff Teys.
Despite the world’s economies reeling from the global financial crisis, the spokesperson for the major processor, which has been operating for 64 years, said it was not all doom and gloom with lower production costs and higher saleyard prices expected across all categories.
"Our currency has played a big part making us efficient around the world in price, particularly Europe. The $A has dropped 35pc against the $US and 40pc against the Yen," he said.
As the guest speaker at the Southern Grassfed Carcase Classic presentation dinner in Naracoorte last Friday night, he delivered the optimistic outlook based on Meat & Livestock Australia’s 2009 Cattle Industry Projections, released last week.
MLA are expecting Australia’s beef herd to reach 28.5 million by June and rise further into 2010, but Mr Teys said this rebuilding may be quicker than they expect with large numbers of northern cattle retained for breeding.
Much of the herd increase will be in northern Australia, where producers are experiencing more favourable conditions, but Mr Teys said with the beef herd heading north it should keep prices buoyant for southern producers.
"There are a lot more weaner sales in the south - it has become more of a breeding area than a fattening area, but when good seasons return hopefully you can produce more fat cattle at a greater rate," he said.
The company is spending about $23 million in a major upgrade of its Naracoorte plant, which it has owned for the past decade, increasing slaughter throughput to 750 head a day.
Mr Teys said the Meat Standards Australia grading scheme the Naracoorte plant implemented more than a year ago had enabled them to process more high, quality grassfed cattle into the domestic market.
And this week Teys Brothers Naracoorte are sending its first shipment of MSA-graded grassfed product to Japan and are looking to expand their grassfed product into the lucrative North Asian market.
Mr Teys said the company process about a quarter of the nation’s cattle hides and this area of their business had been hit hard by the global financial crisis.
"We are having real difficulty selling hides which have gone from $70 to $100 down to less than $10. No one wants to buy leather when things get tight," he said.