Australian beef exports threatened as Chinese buyers look to US


Michael Smith,China correspondent, Financial Review (Australia)

Jun 21, 2020


Xiamen, China | A major Chinese commodities trader has warned it will be forced to abandon Australian beef in favour of US suppliers if Beijing does not lift bans on four of the country's biggest abattoirs in the next six months.


Xiamen Xiangyu Group, a state-owned Chinese company which imports Australian beef, said although it had temporarily switched to other Australian abattoirs, the recent bans had increased costs and complicated logistics and packaging.


"If these four plants are not relisted as early as possible we will have to switch to US beef," Eric Huang, director of frozen food for the logistics and trading giant, told The Australian Financial Review.


"We have time to purchase more, to make up our supply to our end-users. But if this lasts for six months it is going to be hard because moving from one plant to other plants not only increases costs but we also have to educate our end-users."


Xiamen Xiangyu said it imports about 20,000 tonnes of beef to China per month from Brazil, Argentina, Canada, the United States and Australia. Australia accounts for between 1000 to 2000 tonnes of its beef imports per month.


China halted meat imports from four of Australia’s biggest abattoirs in May, citing labelling and health certification issues. The move followed the imposition of heavy tariffs on Australian barley as part of a campaign the Morrison government believes is punishment for its call for an international coronavirus inquiry.


Mr Huang's comments are an indication of the risk the ban poses to Australia's long-term beef exports to China, and the damage to Chinese companies and Australian exporters. Xiamen Xiangyu is one of the biggest Chinese buyers of Australian beef and also owns 5000 head of cattle in Australia.


"There are rumours in upstream and downstream there may be more plants delisted but we have not received any official announcement," Mr Huang said in an interview at the company's headquarters in the southern Chinese trading hub of Xiamen...