GOAT meat prices have fallen this month, following on from the strengthening of the Australian dollar against the US currency, Meat & Livestock Australia has reported.
MLA’s manager of data intelligence Damon Holmes said after maintaining an upward trajectory for the most part of four years, over-the-hook goat indicators have found a new, and considerably lower, level in August.
At the beginning of 2014, over-the-hook goat indicators averaged just over 200c/kg cwt, he said.
“This was the start of a prolonged period of steady growth for the Australian goat market, with direct-to-works indicators increasing at an average rate of 3 percent per month for the next four years.
“Come 2017, goats commanded more than 600c/kg cwt direct-to-works, and indicators reached a high of 683c/kg cwt in early July,” Mr Holmes said.
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MLA said with the majority of Australian goat meat destined for overseas markets, the growth has been largely underpinned by demand outstripping supply. Mr Holmes said Australia’s largest and most valuable goat meat export destination is the US – where increasing consumption is largely related to a growing Hispanic, Muslim, Caribbean and Chinese populations. Around half the goat meat consumed in the US is imported from Australia, MLA said.
For much of 2015 and 2016, the Australian dollar traded in the low to mid-70US cent range – assisting export returns. Since June, however, the $A has strengthened against the $US. After briefly breaking through the 80US cent mark at the start of August, it has hovered around 79US cents for the remainder of the month to date – its highest level since May 2015, he said.
“The rising $A has led to a considerable correction in Australian over-the-hook goat indicators – averaging 457c/kg cwt this week (ending August 25).”
Mr Holmes said the number of goats processed across the eastern states in the first three weeks of August averaged 38,500 head per week, up 14pc on the previous month, and 23pc from August 2016 – largely due to relatively high kill numbers at the beginning of the month. Last week (ending August 18), eastern states goat slaughter fell 36pc week-on-week, to 27,900 head.
Goat meat exports for the first 17 days of August were 1259 tonnes swt – with volumes to the US accounting for 52pc, according to DAWR figures. Between January and July 2017; however, the US has had an average market share of 72pc per month.
Mr Holmes said continuing strength in the $A is likely to maintain downward pressure on goat over-the-hook indicators in the short term. Nevertheless, increased investment in the industry, along with growing demand globally, should continue to support the market as it finds a new level.