Australia is one of the world’s largest producers of beef, accounting for 4% of beef production worldwide and 16% of the global trade. Over the last 70 years, they’ve established a reputation as a leading exporter of high-quality beef across the globe. With their steady supply of beef, they’ve built a long-standing relationship with Indonesia, a predominantly Muslim country with a growing demand for beef.
As a Muslim country, beef plays a significant role in the Indonesian culture because it is the only meat that is considered halal. Because of this, it is a vital ingredient in many of their most popular dishes. Despite the country’s growing demand for beef, local producers can only accommodate up to 60% of the market’s demand. As such, Indonesia is reliant on cattle exporters, like Australia, to help them meet market demands.
The relationship between both Australia and Indonesia is a mutually beneficial one. While Indonesia benefits from the partnership with greater accessibility beef, Australian investors, on the other hand, can find opportunities for cattle farming in the Indonesian market. With the working relationship between both countries, Australian investors can easily tap into existing supply chains, market knowledge, and export opportunities in the Indonesian cattle market.
Apart from greater access to beef and cattle networks, investing in Australian cattle farming in Indonesia can help in developing the latter’s beef market. Australia’s decades worth of experience as a leading beef exporter globally can contribute towards improving Indonesia’s current market structure. Australian investors can also share innovative cattle farming practices and new technology designed to boost productivity and efficiency for farms. This would entail exploring new breeding methods, implementing disease management practices, incorporating sustainable practices, and more.
However promising cattle farming in Indonesia may appear to be, there are some things that potential Australian investors should take into consideration before moving forward with this type of business venture. One of which is partnering with locally established professionals that have experience in dealing with the local cattle landscape. The knowledge of local experts can certainly help towards building supply chain relationships, managing key stakeholders, and understanding local regulatory bodies for cattle farming.
Another point investors should take into consideration is the need to develop an extensive risk management strategy. In dealing with any type of business, there are always risks that can potentially affect business operations. For cattle farming, such risks include fortuitous weather events, highly infectious viral diseases, bio security, and more. Investors can mitigate such risks by preparing insurance and contingency plans.
All in all, investing in cattle Australia for the Indonesian market is a highly lucrative business venture, especially with the latter country’s growing demand for beef. There is an untapped business opportunity for Australian investors to establish themselves in the Indonesian cattle market. For these investors to succeed, they must take necessary steps, like establishing local partnerships with experts and formulating risk management strategies. To deepen your understanding of Australia’s role in the Indonesia’s cattle market, visit our Investor Toolkit.