More than 30 countries have so far suspended US beef imports, including Japan, the US industry’s largest export market.
Taiwan, an important market for Australia, has announced its
intention to temporarily ban beef imports from the United States and says it may increase its take from Australia and New Zealand to make up the shortfall.
Japan is looking to double its order of beef from at least one Australian company and exporters generally are hoping that some of the 20 or so other countries which have moved to ban imports of US beef will follow suit.
US authorities said they had found a suspected case of mad cow disease in an animal from northwestern Washington state, confirming it was infected with the fatal brain wasting disease on Thursday.
Shares in Australian Agricultural Company Ltd (AACo) surged almost 20% from $1.09 last Wednesday to $1.30 on Monday, in expectation of increased business for the key beef exporter.
Macquarie Equities private client adviser David Halliday said AACo shares had jumped amid speculation that beef exports out of the US would be hit very hard and AACo is well placed to benefit.
“There will be a big demand for Australian beef, especially in America with the free trade agreement due to be signed in the next few weeks”
West Australian Pastoralist and Graziers Association President
Barry Court said while the case of mad cow disease was bad news for the United States, it should drive up the price of Australian beef overseas.
“There will be a big demand, especially in America but worldwide now for Australian beef, which is very disappointing for the United States but a plus for us, especially with the free trade agreement due to be signed in the next few weeks,” Court said, referring to a planned FTA with the United States.
Richard Rains, chief executive of beef exporter Sanger Australia, said that since Christmas the company had enjoyed unprecedented demand from Japan and Taiwan, with Japan alone looking to more than double its order of beef.
The United States, which exports more than $1 billion in beef to Japan alone, is also Australia’s largest export beef market, worth about one billion Australian dollars a year.
Japan and South Korea are Australia’s second and third largest
Australia has imposed a temporary ban on US beef products.