The ban on live cattle exports to Indonesia in 2011 and drought in northern Australia have caused a drop in cattle prices that contributed to a $31.6 million half-year loss for Australia’s largest beef producer. Although AACo sold 17% more cattle in the six months ending in September than in the prior six months, live cattle prices fell 12% in that time due in part to a surplus of cattle in the domestic market because of the ban on live cattle exports. Additionally many of AACo’s properties saw their lowest rainfall on record. AACo’s beef division which targets higher value customers through Wagyu, grass, and grain-fed beef for restaurants and retailers offset these losses to an extent. The company is optimistic however. It is in the process of transforming from a pastoral company to an integrated producer, processor and marketer of beef with the construction of an abattoir and processing and packaging facility in Darwin enabling it to take advantage of the rising global demand for beef.
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