The plan comes as the Gillard government faces a backlash from Labor MPs, the Greens and independents over footage showing the brutal killing of export cattle in some Indonesian abattoirs.
Meat and Livestock Australia (MLA) says under its proposal only abattoirs meeting World Organisation for Animal Health standards would receive Australian cattle.
And the process of "stunning" - which exceeds global standards for ethical treatment of animals - would also be encouraged.
The MLA`s preliminary audit of the 100 processing facilities that have been receiving Australian cattle has graded the facilities into four categories.
Five facilities are doing better than global standards and another 20 consistently meet the standards, the MLA said.
It also proposed that animal welfare officers be stationed at each of the 25 abattoirs to ensure Australian cattle are handled to proper standards.
The MLA said 60 per cent of Australian cattle sent to Indonesia goes to 75 other facilities.
"Facilities in the remaining categories will not receive Australian cattle until they can be guaranteed to meet accepted standards," the MLA said.
Meanwhile, Labor MPs are closer to securing enough support for a motion calling on the government to ban all live cattle exports to Indonesia.
The Labor caucus will next week vote on a motion from MPs Janelle Saffin and Kelvin Thomson calling for the ban.
Senator Ludwig last week suspended exports to the abattoirs in question, pending an investigation, but has flagged possible further action.
The issue has triggered outrage across all parties, and the independents and Greens have called for an inquiry and legislation to ban exports to Indonesia within three years and an eventual ban on all live animal exports.
Labor MP Stephen Jones on Monday joined colleagues in calling for the live export industry to be phased out in favour of creating more jobs in Australian abattoirs.
"My own view is when I see cattle being loaded on to live export ships I see Australian jobs (being shipped overseas)," Mr Jones said.
Independent MP Andrew Wilkie said the issue showed a lack of "ethical governance" by Prime Minister Julia Gillard.
"The Australian community expects more of this government," he said.
"The government does need to find its moral compass, it does need to move decisively."
Mr Wilkie met with Senator Ludwig in Canberra, but described the outcome of the meeting as "disappointing".
Greens senator Rachel Siewert said an inquiry was needed into how the MLA had managed the money it reaped from the cattle industry to ensure Indonesian processors met proper standards.
"This body should have been keeping their eye on the ball on this issue," she said.
Opposition Leader Tony Abbott told reporters in Sydney he believed live exports should continue, but Australia should insist overseas abattoirs meet the highest standards.(*)
Editor: Aditia Maruli Radja
Copyright © ANTARA 2011
