Beef exports to Indonesia see gradual increase

Monthly exports of beef and beef offal to Indonesia 2014-2019, by value

New Zealand’s red meat trade with Indonesia is gradually starting to flow again with exports of around 3,600 tonnes of beef and beef offal worth $11.5 million arriving in the market in the first quarter of 2019, according to Meat Industry Association (MIA) analysis.

New Zealand and the US won an appeal in the World Trade Organisation (WTO) disputes tribunal last year against Indonesia’s import restrictions. Since then, Indonesia has brought its meat export regulations into compliance with the WTO rules, meaning New Zealand beef exports in theory now should be flowing freely into the market.

The majority of the Q1 exports, however, were beef offal worth $7.1 million, an increase of 49 percent compared with the same period in 2014 (prior to the start of the WTO case). Cuts of beef only accounted for only $4.4 million – 83 percent lower than in Q1 2014 ($26.3 million).

Sirma Karapeeva, MIA trade and economic manager.

MIA trade and economic manager Sirma Karapeeva explains now India has access to the market for its lower-value buffalo meat, it has been grabbing market share. Also, Indonesia’s fundamental domestic legislation, stipulating the country’s drive to self-sufficiency, has not been changed as yet, meaning in theory new barriers can still be erected.

“MFAT is working with Indonesian officials and making good progress in what will be a lengthy process, partly because of local elections. But is it important that we continue to push for full compliance to create more certainty in the market,” she says.

With more of New Zealand’s high-quality beef now heading off to customers in China, Karapeeva thinks Indonesia will continue as an important, but steady, market for New Zealand, “But, I don’t know if we’ll see it at the heyday of 2010 again.”

This is echoed by Mike Goldfinch, Greenlea Premier Meat’s marketing manager, who says the company’s trade of beef offal products – which include lips, tongue root, hearts, livers and tails – has been steady.

“We sell a relatively limited basket of products, but these are moving well and pricing has been competitive.

“We are not forecasting any major change in our business for this market, unless something was to negatively affect our business into China,” he says.

While Goldfinch has not had any direct examples of goodwill from New Zealand’s response to the Christchurch attacks, as he has not had the opportunity to visit the country since, he thinks it will have gone down well with his customers.

“Knowing our customers well, I can imagine they were impressed,” he says.

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