Rapidly expanding and large middle-class consumers in Indonesia as well as ongoing infrastructure development support investing in cattle farms for long-term growth in Indonesia, especially for boxed beef and Australian live cattle.
For years, Indonesia became a famous billion-dollar cattle and beef export market for Australia. It started between 2018 and 2019 and now it presents a lot of opportunities for investors in Australia across the beef supply chain in Indonesia.
Investing in Cattle Farms for Long-Term Growth in Indonesia
Indonesia is going to become the fourth biggest economy with the real GDP or economic growth projected to be 5.1% in 2023. It is comparable to other trading partners of Australia, like India (6.5%) and China (5.3%).
Indonesia is now one of the fastest-growing countries in the world. It also has comparatively urbanized consumer markets. In 2016, the number of households that earned at least USD35,000 a year is 480,000 and it is expected to increase and reach 3.8 million by 2026.
The growing appetite of Indonesians for safe and healthy food products presents a growing consumer market, especially for Australian exporters.
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Opportunities for Those Who Invest in Cattle Farms
The infrastructure of the country is rapidly improving to support the expanding trade of livestock and red meat. IA-CEPA or Indonesia-Australia Comprehensive Economic Partnership Agreement now includes preferential arrangements and tariffs for various commodities.
Those commodities include frozen beef, live cattle, goat meat, and sheep. It represents Australia’s market access conditions that enhance significantly.
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Special Economic Zones
The Indonesian government recently established 15 SEZs or special economic zones known as KEK or Kawasan Ekonomi Khusus. These areas are designed with some boundaries with some economic advantages, especially access to global markets through air and sea.
The goal of this system is to accelerate the development of the country’s economy. That’s why infrastructure and connectivity become the government’s priority. The government invests in roads like major connecting roads, urban mass transit, airports, ports, and rail.
It is a sign to invest in cattle farms. Airports and ports continue receiving high priority to connect thousands of inhabitant islands.
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Rising Demand in the Country
Australia has sold food to this nation for a long time. But now, there’s rising demand, especially for ready-to-eat-and-deliver products as well as pre-packaged products that are ordered and marketed online. Investments in the new cold chain will support these segments’ growth.