Articles in this document:

· A beef with Russians

· Message from Russia of love for Aussie beef

A beef with Russians

Kate Dowler

The Weekly Times - Australia

November 12, 2008

THE global financial crisis has taken its toll on Australian beef exports to Russia, with Russian importers struggling to make payments on time.

But the long-term outlook for the market - Australia's fourth largest - remains bullish, according to Russian National Meat Association chief executive Sergey Yushin.

Mr Yushin, who is visiting Australia this week, said Russia produced only 35 per cent of its beef and its cattle herd was on the decline due to difficulties sourcing finance.

The country remained reliant on beef imports, shipping in 700,000 tonnes this year and a forecast 750,000 tonnes next year.

South American countries remain the largest exporters to Russia, Mr Yushin said.

"Australia has dramatically increased its exports to Russia, largely because it has become more price competitive compared to Brazil," he said.

According to Meat and Livestock Australia, local beef exports to Russia have been the highest on record this year.

But they have fallen from the record 17,280 tonnes (shipped weight) in May to just 4456 tonnes in September.

Exports to Russia in the first nine months of this year totalled 65,861 tonnes, compared to 5063 tonnes for the whole of last year.

The most recent slump is due to negative seasonal factors, high stocks, declining seasonal demand and the credit crisis.

Mr Yushin said Australian beef still only accounted for 8 per cent of Russia's total beef imports and there was no reason Australia could not increase shipments, providing the price was right.

"Australia is a stable and reliable supplier, with no disease problems," he said.

But congestion on Russian ports could pose logistical problems (for meat shipped great distances)."

And the credit crisis meant some importers were having trouble making payments, he said.

A lack of trust throughout the supply chain was creating an unstable and unpredictable market.

It was therefore vital that Australian exporters and Russian importers found solutions, Mr Yushin said.

"The Russian Government is now trying to speed up payments throughout the supply chain - within two months we hope things will improve," he said.

Mr Yushin said Russia's economic growth was 7 per cent but could fall to 3 per cent in the coming year.

According to MLA, some importers have walked away from or sought to renegotiate contracts made under the higher Australian dollar for product in transit, and several have been unable to secure credit.

MLA said most Australian suppliers remain reluctant to negotiate price, but some exporters were starting to drop prices to big customers.

weeklytimesnow.com.au

Message from Russia of love for Aussie beef

ANDREW NORRIS

Queensland Country Life – Australia

12/11/2008 10:17:00 AM

The future for exports of Australian beef to Russia is looking good with imports by the growing economy increasing by more than 40,000 tonnes from 2007 to 2008.

The bearer of the good news was the chief of the executive committee for the Russian National Meat Association, Sergey Yushin, who is in Orange today for Meat and Livestock Australia’s Meat Profit Day.

This increase had come about due to the quality of Australian beef and its ability to meet Russian quarantine protocols, plus an inability of local production to meet growing demand, Mr Yushin said.

In as short a period as a couple of years, he said Australian frozen beef imports to Russia had increased from almost nothing, to accounting for 8pc.

In 2008 the US provided 2pc.

Also driving demand were factors such as low efficiencies in local production, a Government which didn't properly understand the meat business, and a large proportion of small scale producers.

For these reasons, plus a declining Russian herd, Mr Yushin expected imports of beef to increase.

He said this would provide opportunity for Australian suppliers providing the quality remained high.

Source: The Land

qcl.farmonline.com.au