Australia sees fire and rain

by MEAT&POULTRY Staff
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Australia is enduring, in two different parts of the nation, the twin calamities of devastating wildfires and monsoon rains. The fires, in which arson is the suspected cause, have been blamed for the deaths of 181 people to date in the state of Victoria, and the torrential rains in Queensland, the nation’s most important beef-producing state, are flooding some large cattle stations with rainfall totals that are among the highest ever measured over 90 years. However, the degree of impact the calamities are having on Australian meat production will not be known for several weeks or months, according to Meat & Livestock Australia, a trade and marketing group.

"These two tragedies are still unfolding," Michelle Gorman, MLA’s regional manager for North America, told MEATPOULTRY.com. "The good news is that there isn’t much beef or lamb production in Victoria that’s being affected by the fires, although the important wine industry there is having a hard time of it." She said the fires, which have caused Australian Prime Minister Kevin Rudd to declare a national day of mourning for scores of victims, were made worse by extremely high temperatures in excess of 104 degrees Fahrenheit and by 60-mph winds. "Over the past five years, the general advice to people who live in these areas has been to stay with their properties and help protect them. But with the heat and, especially, the wind, people got stuck. They literally could not outrun the flames." To date the fires have destroyed more than 1,000 homes in Victoria and have scorched more than 1,100 square miles of land.

In Queensland, monsoon rains tend to be seasonal and the livestock and meat industry there is accustomed to adjusting to extremely wet weather, though Gorman noted that this year’s rains are even heavier than usual "and could have an impact" on short-term meat production. Queensland is home to 42 percent of Australia’s beef herd, more than twice the total of any other Australian state. Moreover, monsoon rains have also been pummeling the Northern Territory, where cattle, though far fewer in number than in Queensland, tend to be grouped in large cattle stations (ranches) located along waterways such as the Katherine River.

The rains have actually been good news for AACo, the largest cattle-production company in Australia. The drought that the rains finally broke cost AACo an estimated A$29 million, contributing to the company’s estimated loss for 2008 of up to A$42 million. But the wet weather, which is bringing back grasslands, combined with falling oil prices and improving dollar-exchange rates with the U.S. have the company feeling optimistic for 2009. In a statement issued in early February, AACo said its prospects for the year looked like "a complete reversal" from 2008.

MLA’s Gorman told MEATPOULTRY.com that two other companies with major holdings in the Australian beef industry, Cargill and JBS, will be impacted by the fires and rains in different ways. Cargill, she said, "won’t feel much, because its operations are mostly in New South Wales." JBS, however, draws a lot of cattle from Queensland and could be impacted by the rains if flooding continues to disrupt production.

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