Allan Barber looks at the Indian buffalo trade and says NZ needs to pick its premium beef market destinations carefully, ones that will value the product and processes we offer

By Allan Barber

India has exported well over 500,000 tonnes of buffalo to Vietnam in 10 months of the latest July to June year.

This figure easily exceeds the total of New Zealand’s beef exports to all countries.

Over the same period India’s total bovine (buffalo) exports were 1.45 million tonnes at an average value of US$3041 (NZ$3475), while the average price to Vietnam was US$3489 (NZ$3987), an increase of 40% since 2012.

Other main markets in order of importance are Malaysia, Egypt, Saudi Arabia, Jordan and United Arab Emirates.

In comparison New Zealand’s beef exports command an FOB price of between $5000 to the USA, Canada, Korea and China and up to $9000 to French Polynesia, the highest paying market, with other main markets such as Japan, Taiwan and Europe at various points in between.

However the most surprising, or alarming, feature of the Indian buffalo trade is the tiny number of licensed exporters in relation to the total number of abattoirs.

There are 53 government licensed abattoirs, of which only one is located in the south western state of Kerala where the main port of export Cochin is located.

According to a newspaper article there are 298 illegal abattoirs in Kerala alone which happens to be the state with the largest meat consumption in India because it is a predominantly Christian state with a more relaxed lifestyle than other parts of India.

In contrast to New Zealand’s highly regulated meat processing industry which must meet stringent food safety standards, India’s appears to be able to process and export to a number of countries with less demanding standards.

Obviously we would not want to produce twice or three times the amount of beef to sell at a substantial discount to the price we obtain from our customers.

But it does highlight the fact that feeding the world’s hungry markets does not always depend on producing the best quality; there is a place for cheaper (in all sense of the word) food.

While Indian authorities are said to have the unlicensed abattoirs ‘in their sights’, the scale of the non-compliance suggests it will be several years before the authorities bring them all under control.

It may be that they aren’t really serious about doing so.

As we search for free trade agreements, we should bear in mind that not all countries will want our high quality, safe and expensive products.

We need to pick our premium market destinations carefully and sell to those that are prepared to pay a price which reflects both its quality and cost of production.

Information on Indian buffalo exports sourced from Carvings by aginfo.com.au.  

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Allan Barber is a commentator on agribusiness, especially the meat industry, and lives in the Matakana Wine Country where he runs a boutique B&B with his wife. You can contact him by email at allan@barberstrategic.co.nz or read his blog here ». This article was first published in the Angus Cattleman and is here with permission.