Very tough trading conditions for New Zealand (NZ) lamb into the EU market continues to see product shifted toward other major markets, increasing competition for Australian shipments, especially in the Middle East and China.
For June, NZ lamb exports totalled 24,616 tonnes swt, up 4% year-on-year, despite a 21% contraction to their largest market, the EU, at 8,319 tonnes swt (Beef + Lamb NZ).
Given the 228,254 tonnes swt sheepmeat quota for NZ into the EU each year, it is easily NZ’s largest and most lucrative export market.
However, the first six months of 2012 has seen NZ lamb exports face very tough trading conditions into the EU, dominated by sluggish consumer demand and a near-record high NZ$ against the Euro.
For January to June 2012, NZ exports to the EU totalled 67,813 tonnes swt – down 17% year-on-year, 30% below the five-year average and the lowest first six month total for the past two decades.
Illustrating both the historical dominance of the EU market for NZ lamb and the recent decline in 2012, exports to the EU for the period of 2007-2011 made up just over 50% of total exports.
In contrast, exports to the EU for the first half of 2012 were at 42% of total exports, with May and June only reaching 35% and 34%, respectively.
As a result of the weak conditions in the EU, NZ exports have been directed to other markets so far in 2012, with larger volumes primarily to China and the Middle East – increasing competition against Australian product.
While already a major market for NZ product, exports to China in the first six months of 2012 have increased 39% year-on-year, to 32,903 tonnes swt – rapidly approaching the total for the entire calendar year 2011, at 37,585 tonnes swt.
Similarly, exports to the Middle East have increased 33% year-on-year, to 19,620 tonnes swt.
Across other markets, NZ shipments been mixed for the first six months of 2012, with the US back 15% year-on-year, as sluggish consumer demand continues to impact shipments.
Overall, NZ lamb exports for the first half of 2012 totalled 160,077 tonnes swt – down 3% year-on-year and 23% below the six-month record set in 2007.
Also contributing to the lower exports in 2012 has been historically tight lamb supplies and production compared with the past decade, with the exception of 2011.
The increased competition from NZ lamb in China and the Middle East has been one factor contributing to the lower Australian saleyard lamb prices in 2012, along with a 15% increase in Australian lamb production for January to May.
Source: MLA.com
Back to News Headlines