One of the WA's biggest live sheep exporters says it is on target to resume shipments to Saudi Arabia this year, defying industry predictions that the crucial market will remain closed.
Fremantle-based Wellard said yesterday it would begin shipments later this year after opening its own feedlot and abattoir in Saudi Arabia.
Wellard is upgrading an existing abattoir in a deal with a local investor which satisfies Saudi foreign ownership laws and allows Wellard to control the supply chain from WA farms through to processing.
The Saudi market has been closed to Australian exports since the phasing in of the Federal Government's exporters supply chain assurance system last year in response to animal welfare concerns.
Wellard is confident it can become the first company to establish an ESCAS-approved supply chain in Saudi Arabia, which was Australia's biggest market as recently as 2007 when it imported 1.032 million sheep.
Wellard owner Mauro Balzarini said he had plans to introduce the same business model in other Middle Eastern markets, including Libya and Egypt. "We see the fully integrated supply chain where we have control every step of the way as very sustainable," he said.
Mr Balzarini said Wellard was committed to working under ESCAS and accepted that it was "here to stay", but warned that Australia faced growing competition from countries such as Brazil, Somalia and newcomer Romania in the live export industry.
"If a market needs meat, they will buy meat. If not from Australia, then from somewhere else. Romania exported 1.2 million sheep last year and that has grown from almost zero," he said.
Wellard's exports to Saudi Arabia hit 460,000 head in a single year at the peak of the trade, which has dwindled since 2007 and fell to just 69,000 head from all Australian exporters last year.
Meat and Livestock Australia figures released yesterday predicted an 18 per cent fall in live sheep exports and a 14 per cent fall in live cattle exports.
The forecasts were based on no exports of sheep to Saudi Arabia or Bahrain, which imported almost 250,000 last year before Australian exporters imposed a voluntary ban on the country.
The ban came after Bahrain refused Wellard's Ocean Drover permission to unload about 20,000 sheep from WA amid claims some animals were diseased. The sheep were sent to Pakistan where a brutal cull by local authorities caused outrage among Australian farmers and animal welfare groups.
MLA said its bleak forecast for live cattle exports was based on another cut in import quotas by Indonesia, which remains Australia's biggest customer. However, MLA predicted that beef, lamb and mutton exports would increase on the back of lower prices.