Australia cashes in on beef exports as US cattle herd shrinks

In a refrigerated room, around two dozen staff in hats, gloves and blue plastic aprons carve and pack carcasses into boxes within minutes of their slaughter.

The Monbeef slaughterhouse, owned by Bindaree Food Group and located about 100 kilometres south of Canberra, processes some 200 cattle a day, up from 30-40 two years ago, and could ramp up to 220 in the coming months.

"It's an ideal time," said Ryan McDonald, the plant's livestock manager. "Demand out of the U.S. export market is driving the prices up in abattoirs, which then drives the market up for cattle."

A slump in U.S. beef production has opened the door for Australia to export record amounts of meat, growing its market share in North America and Asia and channelling billions of dollars to cattle processors and farmers.

Australia and the United States are among the world's largest beef exporters. Each accounts for a little over 10% of the global beef trade, sending around a million metric tons worth some $8 billion overseas every year, trade data show.

Drought has shrunk U.S. cattle numbers to their smallest since the 1950s, prompting the country to import more beef and export less.

Analysts expect U.S. beef exports to fall further as farmers hold back cattle to breed and rebuild herds, creating a growing market opportunity for rivals.

Most big beef exporters, including top shipper Brazil, have limited ability to take this opportunity either due to production downturns or limited market access.