The Minister for Agriculture, Tony Burke, has today announced an agreement between the two governments under which cattle will be slaughtered only at a new abattoir east of Cairo.

The cattle will be handled and slaughtered in accordance with international standards for animal welfare, Mr Burke said.

The $730 million trade was stopped by the Howard government after footage was aired showing serious mistreatment of cattle by Egyptian handlers.

The resumption comes before Tuesday's Federal Budget, which will commit almost $8 million to improving the standards of all Australian live exports.

This will include funding upgrades of livestock facilities to meet international welfare guidelines and education and training in areas such as feedlot management and nutrition.

The Australian and Egyptian governments have signed two memoranda of understanding on the handling and slaughter of Australian live animals. The agreement requires the monitoring and recording of movements of Australian dairy cattle through a 'closed system' which only permits the use of the new abattoir at the port of Ain Sokhna.

Australian officials and industry assessed the facility and were satisfied it was consistent with World Organisation for Animal Health (OIE) guidelines for animal welfare.

Cattle will not be permitted to be moved to other Egyptian abattoirs or feedlots.

"This decision has not been taken lightly and is subject to strict conditions," Mr Burke said.

"The Government is committed to world's best practice and addressing genuine community and international concerns about animal welfare in the live export trade.

"Australian cattle will only be imported to Egypt into the new, state-of-the-art feedlot and processing facility in Ain Sokhna.

"They will be handled and slaughtered in accordance with international standards for animal welfare."

The livestock export industry has applauded the announcement, saying Sokhna Livestock Company's new facility in Egypt will have livestock experts handle cattle from vessel to feedlot to processing in one location.

"While it will be several months before the operational orders are finalised and in place to allow shipments to commence, Australians can be confident that there will be proper controls to ensure the welfare of Australian cattle exported to Egypt," LiveCorp CEO Cameron Hall said.

"In fact, under this system Australian cattle will be well cared for and managed under agreed procedures throughout the entire livestock export chain – from the farm in Australia to the processing facilities in Sokhna."

Upon arrival at the new facility, cattle will disembark the livestock vessel and walk 800 metres to the shaded feedlot, where they will have access to feed and water.

Once ready for processing, the livestock will walk 50 metres from the feedlot to the new modern processing facility.

The system will also be fully auditable. Each animal will have an individual electronic tag device and will be scanned prior to leaving Australia and upon arrival at the feedlot in Egypt.

This tag will be collected at the point of processing and verified back to the original animals on the shipment.