The overall meat protein shortage in China is driving incremental growth in lamb and mutton sales out of Australia, banking sector animal proteins analyst Matt Costello told producer audiences in NSW and South Australia last week.
Addressing graziers, processors and industry stakeholders in Sydney and the Coonawarra region of South Australia, Mr Costello said sheepmeat prices were expected to hold firm for the remainder of 2014.
“We are continuing to see the growth in emerging sheepmeat export markets – particularly China – as they have tight domestic supplies of sheep. Technically, China has the world’s largest sheep flock, however there is a shortage of protein which is requiring the Chinese to look to markets like Australia to source more of their protein requirements,” he said.
For the 2013-14 fiscal year to the end of May, Australia exported more than 94,000 tonnes of sheepmeat to China, compared with 64,000 tonnes for the same period a year earlier – a 47 percent rise.
Frozen mutton exports have represented the biggest part of that growth, rising 70pc to 56,400 tonnes, while lamb has risen 23pc over the same period, reaching 37,760t. Almost 90pc of that lamb was in bone-in, frozen form.
Total sheepmeat exports to China for the full financial year ended June 30 could easily exceed 100,000t for the first time, analysts suggest.
Mr Costello, who has a degree in Agricultural Economics from Sydney University, began his career in market analysis with Meat and Livestock Australia before joining Rabobank last year.
He said there had been a lift in meat sheep prices in Australia, as supply has been tightening as 2014 progresses. While there had been more consistent supply in recent months, demand had remained very strong.
“Due to the large volumes of sheepmeat processed in the drier period in 2013, this year we have seen supply tighten and prices have responded accordingly, boosting returns for producers – in both Australia and New Zealand,” Mr Costello said.
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