Live cattle export boats in limbo as Indonesian importers negotiate new breeder cattle quota rules

Live cattle export boats in limbo as Indonesian importers negotiate new breeder cattle quota rules

Live cattle export boats in limbo as Indonesian importers negotiate new breeder cattle quota rules

Updated 29 September 2016, 17:25 AEST

Six Australian live cattle export ships remain anchored as Indonesian importers negotiate terms to new breeder cattle quota rules.

At least six Australian live cattle export ships remain anchored outside key northern ports as Indonesian importers negotiate terms to new breeder cattle quota rules.

Already dealing with record high cattle prices, exporters are now having to absorb the huge costs of having ships sitting idle.

Three vessels are waiting to load in the outer Darwin Harbour, two ships are near the Townsville Port, and one sits off the Broome coastline.

While it is understood three Indonesian import companies have been issued with permits to buy Australian cattle, the remainder are still negotiating with the Indonesian Government over a mandatory requirement to import a percentage of breeder cattle.

ABC Rural understands at this stage the percentage is 20 per cent, which equates to one breeder animal for every five imported.

Jakarta-based veterinarian consultant Ross Ainsworth, who regularly writes about the Asian cattle market, said the costs to exporters having ships sitting idle was "horrendous".

"It's not sustainable. The ships will have to be sent somewhere else or the companies will simply run out of money," Dr Ainsworth said.

"The demurrage has to be paid and the ships have to move, so it's a disastrous situation for the exporters, but unfortunately it's totally out of their control."

It is not clear how long the negotiations between importers and the Indonesian Government will take.

Similarly, there is little understanding about how this new policy, if fully implemented, might affect cattle numbers sent from Australia to Indonesia.

Nearly four weeks into trimester three, exporters would have expected to have import permits in-hand to start moving stock.

Dr Ainsworth said if the proposal went ahead to import such large numbers of breeder cattle, the Indonesian feedlot operators would not survive financially.

"It's quite unbelievable that they could have been forced into this position," he said.

"The Government is expecting private enterprise to carry out the policies of the Government at the cost of private enterprise.

"If they bring in these large numbers of breeders with their feeders, they'll go broke, that's a given.

"If they stop operating because they don't agree with the Government's policies, they'll have no animals, their assets will be empty and they won't be able to operate their normal business, so they'll go broke."

The next cattle shipments may depend on which Australian exporters have existing business relationships with the three import companies to already have import permits supplied.