Western Australia’s live export market is facing further uncertainty as tighter regulation and the high Australian dollar put pressure on both farmers and exporters.
The incident of a shipment of live sheep being turned away from Bahrain earlier this month has once again thrown the spotlight on animal welfare in the market and halted movement of some stock from WA.
The market, worth more than $500 million in 2010-11, was already under strict control after the federal government’s introduction of the Exporter Supply Chain Assurance System regulation.
The scheme was first introduced last year following an investigation into live cattle exports to Indonesia.
Exporters must now obtain permits from the federal Department of Agriculture, Farming and Fisheries before moving livestock to about 99 per cent of export destinations.
While the market has adapted to the strict regulations, the recent event has resulted in exporters postponing the movement of livestock from WA farmers under already agreed contracts.
Newdegate sheep farmer Bob Iffla told WA Business News his contract with livestock exporter Emanual Exports had been continuously postponed since news emerged of the shipment being turned away from Bahrain.
The shipment – undertaken by Wellard Rural Exports – was turned away from Bahrain because of concerns the sheep were diseased and ended up being exported to Pakistan, which has since threatened to cull them.
“The government has brought a new permit system into play which means that if the sheep aren’t taken at one port, the exporters have to have another port that they can take them to,” Mr Iffla said.
“I’ve now been instructed that these sheep will not be able to be moved until such a time as a new export permit from the government has been satisfied – goodness knows how long that will take.”
Mr Iffla is just one of a number of farmers to have movement of stock postponed as exporters seek to satisfy the government’s tighter scrutiny of the new regulation.
As a result, the WA market is flooded with sheep needing to be exported, which farmers can’t afford to feed.
“We’ve had probably the worst start to spring that we’ve had for many years and there’s just no feed available,” Mr Iffla said.
“We could possibly take them to auction (to be slaughtered) but if everyone does that the price won’t be there. Also the (abattoirs) just won’t be able to kill all the sheep that need to be killed.”
Western Australian Farmers Federation president Dale Park said the sheep being turned away from Bahrain had sent a ripple of uncertainty through the rest of the Middle Eastern countries.
“One of the problems with the Middle East is as soon as one country knocks it back the others follow suit … that really does complicate the issue.
“Most of our sheep go to an Arab country one way or another, Pakistan really is the last port of call,” Mr Park said.
The problems in exporting logistics are compounding tight profit margins being faced by farmers.
Over the past year the price paid for shipping wethers has fallen 25 per cent, which Mr Park said was largely attributed to the high Australian dollar and was taking a “heavy toll” on farmers.
The delay in exporting sheep was only expected to see the price fall further as exporters would be reluctant to commit to new contracts until confidence in the market returned.
The farmers’ federation has urged greater cooperation between industry and the government to ensure the survival of the live export trade and improve conditions on farmers.
“Coupled with the dry season and reduced supermarket prices it is becoming tough for farmers to remain profitable and to feed our nation,” the federation’s meat section president Jeff Murray said.
