2003, Volume 11, Paper 4

ISSN: 1833-5675

Modelling the effects of a temporary loss of export markets in case of a foot and mouth disease outbreak in Australia Preliminary results on costs to Australian beef producers and consumers

Liangyue Cao, Nico Klijn and Trish Gleeson – Australian Bureau of Agricultural and Resource Economics

Abstract

The size of the cost to the Australian beef industry of a potential loss of major beef export markets following an outbreak of foot and mouth disease (FMD) in Australia is important in determining appropriate precautions. The size of this cost is evaluated with a dynamic bioeconomic model of Australian beef production, consumption and export trade. The model developed by ABARE represents forward-looking competitive behaviour of beef producers and traders on domestic and export markets based on perfect foresight. The model enables estimation of the cost due to a FMD outbreak under various scenarios regarding the duration of market closure and affected zones.

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