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QUESTION: What is the most valuable item that can be harvested from beef cattle in Australia? If your answer was eye steak, fetal blood used in the diagnostic and pathology industry, or heart valves used in human transplants, you’d be wrong.

Gallstones, found (occasionally) in the gall bladder of cattle during beef processing, are currently worth up to $330,000/kg. Compare that to 24K gold, which is worth a record $131,000/kg in Australia this morning.

Beef Central published this deep dive into the gallstone industry in 2015, and many of the points raised in that original article are still relevant today.

Back then, the best quality gallstones were worth about $20,000/kg – still a considerable amount of money, but representing a 1550 percent increase since then. Two years ago, good gallstones were earning $100,000/kg, but the market has simply exploded from 2023.

In fact, our original article on gallstones unintentionally “turned” into a global gallstone marketplace, with hundreds of people around the world posting reader comments as potential buyers or sellers. We suspect some of these, at least, may be gone, so buyers beware.

So how little or how much gallstones are in cattle and are processors making a “kill” at producers’ expense?

The entire gallstone production of the Australian cattle industry each year amounts to only about 200kg, one of the country’s largest brokers in the commodity told Beef Central. The broker asked not to be identified in this report, but was happy to share his insights and opinions on what is driving the latest market trend.

The world leader in the production of gallstones is Brazil, which still manages to produce only 2000 kg of stones per year.

An important point is that while the stones (like the ones pictured above) look like gravel or small stones, they are surprisingly light. The stones are 75% water when they are first recovered and lose much of this weight when they are dried before sale. Sometimes they grow mold and depreciate during this process.

Gallstones can form in the gall bladder of cattle and are recovered at the slaughterhouse during the process of extracting bile from the giblet mass. Their presence, frequency and quality can be influenced by a wide range of factors, such as the type of grazing country and access to borehole water.

Additionally, the provision of gallstones has a lot to do with age at slaughter. A beef slaughter plant is likely to produce more and larger stones per head of processed animals than a year-old grass-fed or grain-fed MSA processing plant.

Are gems profitable?

So how much do beef processors in Australia make from harvesting gallstones?

A broker contact who has dealt with gallstones for 40 years made an estimate a few years ago based on sales that a processor supplier took an average of 30,000 head of cattle to generate 1kg of stones . If this figure is accurate, and if it is assumed that each stone is grade A quality (which they are not), it suggests a return per slaughter head of about $10. However, many stones are of lower quality, so the reality may be considerably less than that – perhaps $5 a head at best, the broker said.

Another large plant in Queensland that kills around 200,000 cattle a year (but few, if any, older cows) told Beef Central that it was lucky to produce 1kg of gallstones sold a year. Even processing plants that specialize in slaughtering cows for beef say the presence of gallstones is “very, very low” relative to the number of cattle killed.

Compare these figures to another by-product harvested from beef cattle, such as Swiss Cut Tongue for example – popular in Japan and currently worth around $25/kg FOB (up to $40/kg in Wagyu). At an average selling weight of 1.5kg, this suggests some processors are making between $37 and $60 a head from the tongue organs – suggesting that gallstones are not nearly as lucrative for processors as they might seem at start.

Processors, of course, would argue that any income generated from the occasional gallstone is factored into the total price they are prepared to pay for slaughter cattle.

So has the volume of gallstones produced by the Australian processing industry changed much as the industry transitioned to younger and heavier cattle – on average at least 12 months younger than a few decades ago?

Surprisingly, said one well-known broker, suggesting that volumes have remained relatively stable over the past 20 or 30 years.

Apart from the period of the global financial crisis around 1998, when gallstones became almost impossible to sell, prices rose steadily, rather than exponentially, for many years until the last boom, the broker said.

While China remains the main market for Australian gallstones, other countries such as Japan, Korea and Taiwan are also customers.

Gallstones as currency

One theory that has emerged about the current extraordinary prices for the stones is that their appeal has outgrown their primary use in traditional Asian medicine.

Apparently, gallstones have become a form of currency in parts of Asia.

“The Chinese economy is in bad shape and rich people in China have been buying gallstones and hoarding them like gold,” an Australian broker told Beef Central.

Another factor was that the Chinese are now limited by law to taking no more than $50,000 offshore, the business contact claimed, so gallstones are being used as a means of transferring cash. Stones bought in Australia are re-exported and sold from China and the resulting cash is parked in overseas accounts, it has been claimed.

“The risk is that when the market turns — and bubbles often do — it can happen with a vengeance,” the broker warned.

With this risk presented, some Australian gallstone brokers have been forced to change their business models to avoid being caught with expensive products in a collapsing market.

“The current price is not realistic and I don’t think it will stay at this level. It’s ridiculous,” the broker said.