Big demand from China boosts Aussie beef industry

Australia's richest woman Rinehart is seeking to ramp up cattle exports

CANBERRA - Soaring demand for cattle from China is likely to bolster the Australian beef industry, analysts said.

Following news that Australia's richest woman and mining magnate Gina Rinehart was seeking to ramp up cattle exports to China, industry experts have said that the country's beef industry was likely to see a robust growth.

Michael Whitehead from the ANZ Bank's agribusiness sector told News Corp this week that it is was no wonder Australia's richest were continuing to pour their money into the beef industry, citing Rinehart and retail giant Gerry Harvey as examples of key investors.

"Being in control of the start of the beef supply chain is a great place to be if protein is going to be increasingly in short supply," Whitehead said of Australia's beef industry.

"Investors, too, are starting to look for industries that can't be disrupted. You can disrupt banks, hotels, media, taxis and property, but how do you disrupt Australian beef.

"So it follows that if you are a billionaire, it is obvious that you will never lose your money by buying and investing in Australian cattle properties. It's a great project and space to be in."

Harold Mitchell, a prominent Australian beef investor, told News Corp that unlike the mining boom, after which demand for resources dropped, it was highly unlikely that a demand for basic proteins such as beef would subside, instead predicting that demand would continue to rise for decades to come, even if prices come down when supply catches up with demand.

A great supporter

"I've been a great supporter of the industry and still think it has a long way to go. There will always be a shortage of protein in a growing world," he said.

"The China trade is just starting to take off and the United States has had so much demand for our hamburger meat; but things are changing fast and we are right at a point where the price of stock is so high that I fear a (price) collapse is coming."

He said if Australian suppliers could breed more beef cattle, Australia would be able to meet the demands for both local and overseas consumers for decades in the future.

Xinhua