Record lamb volumes exported from Australia and New Zealand

By Aidan Fortune contact

- Last updated on GMT

Record lamb volumes exported from Australia and New Zealand

Related tags: Lamb

Australia and New Zealand have reported a record volume of lamb pushed onto the export market in the first quarter of 2019 driven by Chinese demand.

Lamb exports from New Zealand recorded a strong start to the year however this may not last as Beef + Lamb NZ estimated the 2018-19 lamb crop will decline slightly and that high export levels may reflect dryer-than-normal conditions in New Zealand and fewer lambs being held back as replacements.

For the first quarter of the year, New Zealand lamb exports lifted 11% year-on-year and were 5% above the five-year average. New Zealand lamb exports peak in March but can remain elevated through to the end of May.

In Australia, producers have been faced deteriorating feed conditions and water shortages, which has led to increased lamb and sheep numbers being slaughtered. First quarter Australian lamb exports were up 19% year-on-year and were 27% above the five-year average.

Although lamb prices have eased over the past six months as is traditional, the seasonal dip has been far less severe in 2019 for both countries. A reported steady rise in lamb prices over the past six years is reflective of the emergence of China as a major buyer, growing demand in other premium markets and a weakening of both the Australian and New Zealand dollar.

Chinese demand

China now represents half of total sheepmeat exports from New Zealand. Meanwhile; for Australia, it is a quarter. While both countries have greatly benefitted from China, the market remains sensitive to fluctuations in its domestic flock and ongoing trade tensions. A slowing economy could also pose a risk to future demand which has led to Australia creating a diversified export portfolio of premium and secondary cuts markets.

Looking ahead, lamb supplies in New Zealand will continue to dry up until the new season commences in the last quarter of 2019. In Australia, much hinges on a decent autumn break in key sheep-producing regions. Solid Australian rainfall in autumn and winter could see strong pressure applied to prices as producers shift into rebuild phase and restockers battle it out for the limited supply of sheep and lambs. If useful rainfall fails to arrive over the next few months, Australian kills will remain elevated.

Related topics: Markets, Supply chain, Oceania, Meat

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