Australian Cattle Exporters Complain of Difficulty in Planning Due to Indonesia’s Import Permit Policy

Elders International, a major exporter of Australian beef, complained of difficulty in planning its foreign shipments because of the unclear import permit policy by Indonesia.

The southeast Asian country reportedly plans to reduce live beef exports to 280,000 heads from 520,000 heads. However, the announcement is vague because it was not clear if the reduction is a mere threat in retaliation for Australia's suspension in 2011 of live exports after ABC TV's aired a report of livestock maltreatment in Indonesia's slaughter houses.

As a predominantly Muslim country, Indonesia relies mainly on beef and poultry for its meat requirements. However, the country relies more on Australia for its beef requirements because it is less costly to ship the cattle or meat from down under rather than from South or North America.

Some permits, though, have been issued this week. Elders, which holds 30 per cent of the trade of live cattle export to Indonesia, expects to ship about 9,250 heads next week.

"What is critically important is that our Indonesian importer customers receive early and certain notification of their permit allocations, so that they can then place the order on us as the exporter quickly, and we can proactively plan across our supply chains," Elders General Manager of Trading Tony Dage told The Sydney Morning Herald.

He pointed out that if permits are not issued in a timely and certain manger ahead of the coming quarter, exporters would incur significant shipment costs.

Speculations of the first quarter permit range from 50,000 to 60,000 cattle. Indonesia explained the cut in import permits to its target to rely less on imports for its beef requirements and instead be self-sufficient by 2014.

However, Alex Stubbs, board member of AgForce and an Innisfall cattleman, pointed out that per capita consumption of beef in Indonesia went up to 1.8 kilogrammes from 1.4 kilogrammes in the past three years. The country does not have the land or the number of cattle to provide the beef meat requirements of its growing population.

"As a nation, we support Indonesia's efforts to become self-sufficient in terms of food production and we have helped them try to achieve this, but with the number of people they have compared to the number of cattle they can run they just can't do it," the Weekly Times quoted Mr Stubbs.