Spreading risk in different export markets is a good way of handling fickle overseas trade agreements, according to Oakey Beef Exports general manager Pat Gleeson.
The red meat processor believes the US’s decision on Tuesday to withdraw from the Trans Pacific Partnership Agreement (TPPA) will provide more opportunity for Queensland agricultural businesses in Asia.
“We see the change of dynamic in the TPPA as a potential opportunity of us,” Mr Gleeson said.
“Our tariffs are potentially continuing to go down and the US, which is one of our major competitors, are going to be back at 38.5 per cent tariffs.
“You have to spread your eggs around, you can’t have them all in one basket.
“If there is a hiccup like we’ve seen with the TPPA then you have to be able to spread your risk.”
“I believe there will be far greater opportunities for Australian beef,” he said.
“There are still a few trade barriers into China, but we see great opportunity for chilled beef in that country,” Mr Gleeson said.
“We have a vision of changing our business to suit that China market and hit the top end of town, portion control, and shelf ready.
“That’s a change of business for us from traditionally being a commodity whole cut in a cart business.
“We see our beef being processed at Oakey on a Tuesday and placed on shelves in Shanghai by Friday.”
Mr Gleeson expects ongoing difficult operating conditions for the processor throughout 2017 due to restricted cattle numbers.
“It’s going to be tough getting the numbers of cattle this year and we forecast we won’t be at full production at any of our plants,” he said.
“We think there may be some cattle coming forward approaching the winter months because some livestock producers, not all of them, have received a good soaking and fat cattle should be coming from those areas.”