The Australian livestock export industry has seen significant growth and consolidation as an important contributor to Australian agriculture over the last three decades.

Prior to the mid 1970s, the industry was essentially small scale, with small irregular consignments. Since then, however, the sector has grown rapidly, firstly with regular sheep exports to the Middle East and more recently through cattle exports to South East Asia and North Africa.

Exports of sheep peaked at over 7.2M head in 1987, with cattle exports peaking in 2002 at over 970,000 head.

The trade exists because of the demand for livestock in a large number of countries, and Australia's ability to supply good quality and good value, disease free stock.  Demand varies over time due to changes in the terms of trade, however, generally has continued to be strong for economic, religious, cultural or the specific preference of the importing country.

The trade co-exists with a trade in meat from Australia, with both livestock and meat exports contributing significantly to returns for Australian livestock producers.

Live sheep exports

First reports of sheep exported from Australia were in 1845. By 1895, about 1000 sheep annually were being exported from Western Australia to Singapore.

The regular trade to the Middle East developed during the 1970s, with demand coming principally from Iran. Exports to other Middle East countries also developed during the late 1970s and 1980s and at its peak, Saudi Arabia imported 3.5M head in 1987.

Continuing exports to the Gulf markets represents a stable base for an ongoing trade. Kuwait has remained the most consistent market, taking over 1M head in every year since 1992.  Gulf markets include Saudi Arabia, UAE, Bahrain, Qatar and Oman.  Jordan has also been a major market, with smaller numbers going to Egypt.

Initially the demand for Australian sheep in the Middle East was for larger older animals as these represent the best value in terms of dollar per kilogram live weight.

As markets have developed, there has been an increasing emphasis on quality and meeting the Middle East preference for leaner animals. As a consequence, most countries now seek to import younger animals, although there remains a strong commercial emphasis on the cost per kilogram live weight. Exports of the preferred fat-tailed sheep have also grown, with production of specific breeds being developed in Australia to meet this demand.

The development of the trade has resulted in significant adjustments within the Australian sheep industry. Improved returns for wool-growing wethers has encouraged higher on-farm profitability and there is strong sheep industry support for a continuation of the trade.

Live cattle exports

Early shipments of live cattle from Australia consisted mainly of breeder cattle with the development of some slaughter cattle exports to South East Asia and East Asia during the 1970s and 1980s.

In the 1980s, a large trade in feeder steers emerged in the Philippines, and more recently in Indonesia, as sophisticated modern feedlots were developed.

The emergence of this significant trade has created an enormous change in cattle management and practices throughout Northern Australia. For the first time ever, northern cattle producers are able to receive prices equivalent to or better than prices available to producers in South Eastern Australia.

Management improvements as a result of this trend led to higher productivity, increased employment and infrastructure development in the north to support the industry.

The growth in demand from South East Asia has largely been linked with the rapid economic development in these economies and in part is a reflection of Government desire to increase protein consumption by the population. This, combined with a wish to enhance domestic employment opportunities has led to positive efforts to expand the trade.

Being so closely linked to economic development in the region, the trade has recently suffered severely as a result of the economic downturn in 1997 in the region and particularly in the major market of Indonesia. This market has grown strongly since that time, and now represents over 50% of Australian cattle exports.