• August Meat Market Update

August Meat Market Update

Wagyu carves path through pandemic as export demand rises and Australians get a taste

When the COVID-19 pandemic hit last year and restaurants closed around the world, producers of Wagyu beef feared the worst.

"Overnight we lost all air-travel, the ability to shift Wagyu around [the globe] become tough and we lost 100 per cent of that luxury restaurant sector immediately," said Matt McDonagh, CEO of the Australian Wagyu Association. 

Mr McDonagh said demand for Australian Wagyu was now growing faster than producers' ability to supply it.

"We have seen a consistent 20 per cent year-on-year growth in production, but the demand for the product is growing ahead of that rate," he said.

"Our recent estimates are the growth of Wagyu demand is about 30 per cent annually in global markets."

A photo of wagyu cattle eating grass during the day at a farm.
Australia's Wagyu herd is steadily increasing, but still not keeping up with global demand.(

ABC Rural: James Liveris


Australia is the world's largest exporter of Wagyu beef and Mr McDonagh believed supply chains had changed to the benefit of producers.

"You're able to access Wagyu globally now outside of the food-service sector, you can buy direct and I think that played a part in the quick resurgence of Wagyu after that COVID shutdown, particularly in the domestic market."

Peter Gilmour standing in front of his Wagyu cattle.
Wagyu producer Peter Gilmour says his business pivoted towards the domestic market during the pandemic.(

Supplied: Irongate Wagyu


Australians get a taste

Peter Gilmour runs Irongate Wagyu in Western Australia's Great Southern region.

He said prior to the pandemic his business was nearly 100 per cent export focused.

"But when COVID came in, all of a sudden the market started falling like dominos and orders were cancelled, as high-end restaurants, hotels and airlines cancelled their orders.

He said sales to customers in his home state of WA had been really pleasing.

"The response has been quite unbelievable … we've been quite amazed at how we got orders from all over, and from a range of people, different demographics, all seeking Wagyu."

He said the business this year was selling about 65 per cent of its product domestically, but export orders were starting to "pick up dramatically" particularly from China, Taiwan and Hong Kong.

Mr McDonagh said, industry-wide, about 10 per cent of Australian Wagyu was being sold domestically.

He said the purchasing power of export markets would always be a factor in how much domestic sales could grow.

Slabs of raw wagyu steak on a surface.
Around 90 per cent of Australian Wagyu beef is exported.(

ABC Landline: Pip Courtney


Rising prices

Australian cattle prices have hit record highs this year, with the Eastern Young Cattle Indicator (EYCI) surging beyond 1,000 cents/kg (cwt) for the first time.

Mr McDonagh said Wagyu producers were reporting strong prices, but exact numbers were "dependent on individual supply chains".

"It's very rare to see Wagyu cattle traded through saleyards," he said.

"The whole sector is built around long-term supply partnerships and vertical integration, so it's difficult to get [information] on what those premiums exactly are," 

Mr Gilmour said his business had not seen major price increases for Wagyu beef, but Wagyu was still enjoying a strong premium. 

"It's the difference of buying a scotch fillet at $40 a kilogram, as opposed to $130 a kilogram — that's the range you see between normal beef production to high-end Wagyu production."

AACo's Wagyu drive

The Australian Agricultural Company (AACo) runs Australia's largest herd of Wagyu cattle.

Its 2020/21 financial year results showed its average meat price per kilogram increased 8 per cent (up $15.50/kg) and its herd value, which is dominated by F1 Wagyu cattle, increased by $64 million.

a sliced steak in a bowl.
AACo says fine dining restaurants have been essential to its branded beef strategy.(

Supplied: AACo


At its annual general meeting this week, AACo chair Donald McGauchie said the company's "clearest challenge" in FY21 had been the interruption to the restaurant and food service market.

"In the year just gone, chefs were severely constrained. This impacted AACo sales through existing food service relationships," he said,

"In response, the AACo team has worked hard to develop our parallel retail sales channels."

Mr McGauchie said the company had been able to capture new opportunities during the pandemic, and the fundamentals for high-quality beef remained strong.

"The world's middle class continues to demand our product, including a growing gourmet home cooking market," he said.

"We expect underlying demand to continue growing."

Original Article by LandlineBy Matt Brann and Angus Mackintosh

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