Beef prices rise on In­dia cat­tle sale ban

Port Douglas & Mossman Gazette - - NEWS - Lucy Craymer

IN­DIA’S move to ban the slaugh­ter of its cat­tle has sent global beef prices higher in re­cent days, amid con­cerns of re­duced sup­ply from the world’s big­gest ex­porter of the meat by vol­ume.

In­dia’s gov­ern­ment last week de­cided to ban the sale of cat­tle – which in­clude cows and buf­falo – for slaugh­ter at live­stock mar­kets. The gov­ern­ment said the or­der was aimed at pre­vent­ing un­con­trolled and un­reg­u­lated an­i­mal trade. The de­ci­sion ap­plies through­out the coun­try, ef­fec­tively cut­ting off the sup­ply of meat for pro­ces­sors, chal­leng­ing an in­dus­try that ex­ports roughly $5.4bn worth of beef an­nu­ally.

The rules are be­ing chal­lenged in courts by sev­eral state gov­ern­ments, and could take many weeks to take full ef­fect, but some in­vestors are al­ready bet­ting that world­wide beef sup­ply could tighten.

On Fri­day, the Aus­tralian East­ern Young Cat­tle In­di­ca­tor – the bench­mark for Aus­tralian cat­tle prices – ended up nearly 0.8 per cent. In the US, live cat­tle fu­tures on the Chicago Mer­can­tile Ex­change soared to their up­per limit, ris­ing 2.5 per cent, with the In­dia ban con­tribut­ing to the price gains, an­a­lysts said.

“There has been a lot of mar­ket chat­ter around this and the Aus­tralian mar­ket has been bid up par­tic­u­larly,” said Tobin Gorey, a Com­mon­wealth Bank an­a­lyst.

Cat­tle prices have started to re­cover in re­cent months as global sup­plies have tight­ened with in­creas­ing beef con­sump­tion. How­ever, prices are still well be­low his­toric highs as US pro­duc­tion re­mains strong, and Aus­tralian cat­tle num­bers have started to re­cover fol­low­ing re­cent droughts.

An­a­lysts are un­clear on the ex­tent of the global im­pact should In­dia’s beef ex­ports end. The is­sue is com­pli­cated by the fact that ex­ported Indian beef – largely sourced from water buf­falo – is a lowend prod­uct.

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