MV Bahijah live export fiasco has echoes of 2011 live cattle export ban

Australia is still counting the cost of the Gillard-era suspension of the live cattle trade in 2011. The suspension was in response to an ABC Four Corners programme showing Australian cattle being slaughtered inhumanely overseas. Viewers were shown footage of cruel treatment of some animals, the implication being that most animals shipped overseas met a similar fate. Australia had exported more than 500,000 live cattle (worth about $400 million) to Indonesia the year before, so that the effects of the suspension were bound to be ruinous for many Northern producers.

The Federal Court in 2020 ruled that the blanket suspension was "invalid", "capricious and unreasonable", and amounted to "misfeasance in public office" so that the Australian Government was liable for damages. The cattle industry expected compensation of around $1 billion but to date the Commonwealth has offered only $215 million, so that the matter is likely to drag out further in court.

A further issue is that domestic processing and related livestock prices (the alternative to live export) are affected by volatile numbers, high labour costs, regulatory burdens, and soaring energy charges. Returns from sheep had plunged during 2023 and have always been affected by high meat processing costs and periodic oversupply.

Australian meat processing costs are about a third higher than in the US, and (for beef) between 1.45 and 1.75 times the cost in South America. Australia's regulatory cost burden is estimated to be 2.75 times that of Brazil, 2.4 times that of the United States and 1.89 times more than Argentina. Live export avoids many of these costs and helps put more money in farmers' pockets.

Fast forward to 2024 and the same issues are again coming into play. Effectively the animal activist lobby, supported by elements of the media, the unions, and the left wing of Australian politics, saw the crisis with the MV Bahijah as an excuse to put the boot into live export again. [The Albanese government is already committed to ending live export of sheep by sea.] These groups were simply "bursting" for an extreme animal welfare problem to be exposed to provide an excuse to finally end all live export.

The paradigm being pushed is the same now as in 2011 (ie for live exports to be banned, with animals instead to be slaughtered at Australian abattoirs). The premise is that this will be beneficial for both livestock welfare, employment, and for the economy due to greater "added value" being generated in Australia (supposedly a "win-win" outcome). The reality to date has not followed this script.

With cattle, this model has already been busted. AACo in 2017 (against overwhelming industry opinion) built a new $100 million abattoir in Darwin. This became the only such large-scale facility north of a line between Townsville and Perth. The plant suffered large operating losses, so that AACo suspended operations just 15 months after the plant was built, and it remains in mothballs today.

The cold reality is that there is no economic alternative to the live export trade for Northern cattle. The high costs of Australian processing plus difficulty in supplying stock during the wet season seem unsurmountable issues. Also, most live cattle go to Asia on relatively short journeys (three-and-a-half-days from Darwin to Jakarta) and they can be fed and watered en route. This seems preferable to the 1000 kilometres or more road journey (without feed or water) often required for domestic slaughter. Over 75 per cent of Northern properties are reported to be partially or completely reliant on live cattle export so that, if live cattle export is banned, much of the Northern pastoral belt would (at huge cost to local economies) revert to vacant land or maybe become national park.

With live sheep the situation is more complex.

Sheep are generally run south of the Monsoon belt and have closer access to domestic abattoirs. Live export (pertinent mainly to WA) increases in importance as a safety valve when the domestic market is over-supplied, as it has been over the past 12 months. Sheep are known to be less resilient travellers than cattle (even during local road transportation), though mortality rates during export have been significantly reduced through reduced stocking densities, improved ventilation, and other measures on ships.

The MV Bahijah loaded about 2000 cattle and 14000 sheep in Fremantle, and departed for Jordan on 5 January 2024. As a condition of departure, the exporter was required to lodge contingency arrangements should the vessel not be able to reach its proposed destination. The exporter also loaded additional fodder and veterinary supplies above those required by Australian Standards, and a registered veterinarian was on board the vessel.

The federal Agriculture Department ordered the MV Bahijah to return to Australia on 12 January, amid concerns about escalating attacks on commercial vessels in the Red Sea, despite the owners wanting to divert elsewhere. The ship arrived back off the coast of Western Australia on 22 January (during a severe heatwave) but did not berth at Fremantle Port until 1 February. The animals remained on board while the exporter's application to send them to the Middle East via the Cape was evaluated.

The department on 3 February agreed for the animals to be unloaded under strict biosecurity measures. Several hundred head of healthy cattle were initially unloaded to reduce congestion on the ship. The veterinarian on board the vessel indicated there were no significant health or welfare concerns with the remaining livestock, and animal mortality remained below reportable levels (0.5 per cent for cattle, 1 per cent for sheep).

An initial application to send the livestock to the Middle East via the Cape was subsequentlyrefused. A final decision has yet to be made. The livestock are likely to be in the yards for about 10 days to rest before being reloaded onto the MV Bahijah, if a permit is issued. Those in the livestock industry have said that the alternative to re-export is for the animals to quarantine and then end up in a feedlot (which would, they claim, be not dissimilar to conditions on board the ship).

Industry observers believe that the MV Bahijah had to wait for another live export vessel, the Al Messilah, to load sheep before the Bahijah could unload all its livestock. Once the Al Messilah was loaded, there would be space in the Baldivis quarantine and feedlot facility to unload.

The whole saga raises many issues.

Firstly, there is the question of why the ship could not have been diverted to its destination via the Cape without having to return to Australia. Accepted wisdom states that it is unwise to send sheep to the Middle East during the hot northern summer. So why did the Department insist on sending the ship back to Fremantle during its expected heatwave? Arguably, the bureaucratic interference has led to a worse animal welfare outcome. Had the ship been diverted it would have reached its (much cooler) destination by now.

The extreme animal welfare crisis, which many predicted, never eventuated . Two independent veterinarians boarded the ship after it docked. Their report concluded that no major signs of health or environmental concerns for the animals could be detected. It is worth noting that, on its previous (20 day) voyage with 5602 cattle departing Fremantle for Israel on 19 November 2022, there were no mortalities on the Bahijah.

Then there is the political side of the issue. It was the regulator who formally directed the MV Bahijah to turn back to Fremantle, and who later refused re-export. The public face of the regulator was Adam Fennessy, Secretary of the Commonwealth Agriculture Department, who had stated that "I want to emphasise that my department makes decisions on the basis of the application of the commercial exporter".

Agriculture Minister, Murray Watt, emphasised that he was not the legal decision-maker. This is technically correct, though those familiar with how bureaucracies work would know that a public servant would be "courageous" to go against the wishes of a minister or the government. The Labor Party (with support from unions and animal activists) broadly opposes live export, though it is convenient to distance itself and have a bureaucrat take the blame.

Animal activists overseas also played a role. Animal rights groups in Israel say they have filed legal proceedings against the nation's agriculture ministry in a bid to stop the ship from exporting its cargo into Israel. The threat of such action is believed to be a factor in the initial Departmental decision to refuse re-export.

For the exporter the entire episode will probably cost millions (a fruitless return trip to the Middle East and 5 weeks lost time at the very least). Re-export would be the least costly outcome but seems an unlikely prospect. The live export trade has also suffered long term damage because disruptions like this are a bad look, and make Australia appear to be an unreliable trading partner.

Farmers are also big losers. Sheep producers in Western Australia say the decision to phase out live sheep exports has reduced confidence in the WA industry, though poor wool and mutton prices were already biting. Sheep and lamb prices had already plummeted (with a 60 per cent decline commonly quoted over the year to last October). It has been not uncommon for farmers to euthanise some classes of stock (especially light merinos) because there was no return in sending them to market.

This whole saga has shown the left of Australian politics playing its favourite game, namely destroying the wealth of industries they don't like and have no stake in. They seek to do the same with the coal, gas, and nuclear industries, and are broadly hostile to a lot of mining, commercial fishing, and conventional agriculture.

None of this is good for our standard of living.