MIDDLE East markets have turned to lamb carcases from Australia in a big way after the suspension of live exports to Bahrain in August 2012.
Meat & Livestock Australia said since 2012-13, Australia has exported more lamb carcases than ever before.
Over these last four years, lamb carcase shipments have averaged close to 50,000 tonnes each financial year – a huge jump from the average of 14,400 tonnes for the 15 years prior, according to Department of Agriculture and Water Resources figures.
MLA said the 50,000 tonne annual total equated to a jump from 0.9 million 16kg carcases to 3.13 million lambs dedicated to the carcase trade.
Since 2012-13, lamb carcases have consistently accounted for 21-22pc of total Australian lamb exports, compared with the 15 years before then, when the proportion averaged only 11pc.
“It seems carcases have emerged as a fairly significant and stable portion of the Australian lamb export cut composition, meeting specifications and cultural requirements of customers around the world,” MLA said.
Why has the lamb carcase trade been so strong?
MLA said there was significant growth in 2012-13 at the time of Australia’s suspension of live sheep exports to Bahrain in August 2012. In the five fiscal years prior to 2012-13, Australia was shipping in excess of 500,000 head of live sheep to Bahrain each year (ABS). When the live trade was suspended, the market turned to lamb carcase exports – which were virtually non-existent in 2011-12 (105 tonnes). However, this jumped to 9577 tonnes in 2012-13 and carcase exports remained historically high for the next two years (13,253 tonnes in 2013-14 and 9332 tonnes in 2014-15). Shipments then dropped 59pc year-on-year to 3859 tonnes in 2015-16, due to the Bahrain government’s decision to remove subsidies on imported Australian sheep meat and live sheep, MLA said.
However, Australia’s total lamb carcase exports to the Middle East remained robust and in 2015-16 accounted for 47,227 tonnes of the total 51,384 tonnes exported.
MLA said the largest lamb carcase markets in the Middle East are now Qatar (14,815 tonnes), the UAE (13,077 tonnes) and Jordan (10,197 tonnes), where volumes increased 23pc, 15pc and 2pc year-on-year, respectively.
Qatar market underpinned by subsidies
The Qatar trade for chilled whole carcase is underpinned by government subsidies that apply to the whole carcase but not to vacuum chilled primals, MLA said. Although there have been significant increases in whole carcase, there have been decreases in whole leg and shoulder, which some of this carcase trade has replaced. The whole carcase trade services all segments of the market including food service, mainly in the traditional catering and restaurant segment. There have also been considerable increases in the higher valued cuts, such as rack, rump, boneless loin and short loin, as well as shank – which is a great indication that the higher end food service market is developing. This correlates with the development of more 4 and 5 star hotels and higher end dining.
Strong UAE growth in lamb rack, boneless loin and rump
Similarly in the UAE, there has been strong growth in rack, boneless loin and rump, as lamb works its way into more affluent dining facilities, but the carcase trade is where there has been the biggest growth. This product goes into all segments of the market and would be more an indication of urbanisation and the development of the retail sector over many years, MLA said.
“There has also been a shift from mutton to lamb in this market, which we can see in the slower mutton trade.
“The UAE is the most developed market in terms of purchasing and cooking methods, and the greatest cross section of ethnic backgrounds that have a preference for fresh lamb.”
Victoria leads lamb carcases exports
MLA said most of the lamb carcases destined for the Middle East in 2015-16 were loaded in Victoria (34,554 tonnes), followed by Western Australia (8731 tonnes) and New South Wales (3881 tonnes). The bulk of this trade is in chilled product, which is airfreighted to destinations across the Middle East daily.
The other two main markets for Australian lamb carcases, albeit considerably smaller volumes than the Middle East, are the US and Malaysia.
Lamb carcase volumes to the US were down 26pc in 2015-16, to 1951 tonnes, MLA said, although this was not a reflection of a slow-down in trade to the US.
“In fact, total lamb exports to the US recorded 12pc year-on-year growth in 2015-16, to 53,757 tonnes.
“Largely offsetting the declines in carcase, shoulder, rack and short loin volumes in 2015-16, was an 82pc jump in ‘assorted cuts’ and a 20pc increase in shanks during the fiscal year.”
MLA said lamb carcases destined for the US were primarily shipped from Victoria (1653 tonnes) in 2015-16, with most of the remainder loaded in WA (288 tonnes).
Malaysia is a growing market
Malaysia is a growing market for Australian lamb carcases, with volumes in 2015-16 reaching 1153 tonnes – up 9pc on year-ago levels and up 47pc on the five-year average. Victoria was the main state of loading for lamb carcases to Malaysia, at 1039 tonnes for the year.