July 27, 2015

Australia’s Agriculture Minister, Barnaby Joyce, has signed a live cattle export agreement with China that will open a ‘massive new market’ that is expected to contribute approximately $2 billion to Australia’s economy.

Exports of live cattle could begin within weeks, starting at smaller volumes and building in size over time, to eventually reach 1 million head per year within the coming decade.

“We would not be able to supply what they want immediately,” says Mr. Joyce, “We will build up to those numbers over eight to ten years. Ultimately, they want around about a million head a year. We couldn’t supply that now.”

Currently Australia ships 1.2 million head of slaughter cattle to various countries including Indonesia, Egypt, Cambodia, Thailand, and Malaysia, meaning the China agreement could in effect, double Australia’s exports.

The deal, making Australia the first country to export feeder and slaughter cattle to China, has yet to be signed by China’s Minister, Zhi Shuping, but he has confirmed that the two countries have been working on forging the deal for a year and a half.

This deal is separate from the free trade negotiations with Beijing, but those negotiations have assisted this cattle export deal through an included clause calling for the reduction of the current tariff on live cattle exports of 10% down to zero.

Making note of the significant potential this deal holds for Australia’s agricultural economy Mr. Joyce proclaimed, “Superfunds, start asking yourself a serious question: should you be looking at an investment in rural markets?”