Live Cattle Exports to Vietnam Slowed Down

Article by: Hari Yellina

The first live cattle shipment from Darwin to Vietnam left East Arm this week, kicking off what is expected to be another difficult year for trade to Vietnam. In 2021, the number of cattle transported from Australia to Vietnam nearly halved, to 160,000, compared to nearly 300,000 in 2020. According to live shippers and industry professionals, this year will be similar, if not smaller. Since January, only 5,500 cattle have departed Australian ports for Vietnam, compared to over 45,000 in the same period in 2021. According to Tony Gooden of Frontier International, demand for cattle from Vietnam has been “stagnant” for some time, owing to COVID closings in the country last year.

“There was quite a large inventory of Australian cattle in Vietnam at the time [that had been imported from June to September] and additionally, there was also the vessel that came from Brazil,” he explained. “There was also a boatload of cattle from Laos and Cambodia that would ordinarily pass via China, but China immediately shut down the grey trade because to COVID.” As a result, not only Australian and some Brazilian cattle, but also a large number of South-East Asian cattle were stuck in Vietnam. Mr Gooden predicted that increased cattle prices in Australia would limit the number of animals Vietnamese importers could acquire this year.

“I believe there will be some shipments to Vietnam,” he said, “but the amounts will be quite modest compared to the previous two or three years.” Mr. Gooden predicted that more Brazilian cattle would be exported to Vietnam this year. “It wouldn’t surprise me if two or three more shipments were made this year,” he said. “This will imply less livestock from Australia because Vietnam only need a certain number of animals.” Meat and Livestock Australia issued the first pricing indication for the live export trade this week. The Live Export Price Indicator (LEPI) will measure the average sale price of male feeder cattle bought by exporters for transportation to Indonesia from Darwin.

The LEPI was $4.98 per kilogramme this week, with 5,170 head of male feeder cattle shipped from Darwin to Indonesia during the reporting period. Tom Dawkins, chief executive of the NT Livestock Exporters Association, said the industry had put a lot of effort into establishing the indicator over the last year. “From the station entrance to our consumers in Indonesia, everyone in the supply chain supports quick and trustworthy market price reporting,” Mr Dawkins added. “Because they are actively buying and selling cattle on a daily basis and maintain ties with producers in Australia and importers in Indonesia, accurate market information is very much in the exporters’ interest.”