International demand for Australian sheepmeat has been strong throughout 2022, despite a variety of economic and logistical challenges. In fact, year-to-November lamb export volumes reached a record high, while the latest lamb export value data also shows it coming in at a new high. Mutton, while far from record territory, has also gained ground on last year for the year so far. The flock rebuild coming to fruition may be creating price volatility domestically due to plenty of supply, but it does mean our export partners can more readily get their hands on Australian product. .
Australia exported 261,082 tonnes shipped weight of lamb for the first 11 months of 2022, which was a record amount for that period of time, and will likely result in a record high for the year. Lamb export volumes for the year-to-November were up 7% both on the previous year, and on the five year average. The US was one of the major drivers of increased lamb exports, becoming the largest market for lamb with 26.7% of all product sent overseas, and increasing their Australian lamb volumes by 9% year-on-year. The year-to-November volume sent to the US has already surpassed all previous year’s total annual volume.
Moving to mutton, it was China that underpinned the export market, going somewhat to make up for the fact that its lamb demand was lacking. Total mutton export volumes lifted 4% year-on-year for January to November, but remain well below (9%) the five-year average for the period. Prior to the flock rebuilding years of 2020 and 2021, we have to go back a decade to 2012 to find a year with lower mutton exports. As mentioned, China lifted their market share of Australian mutton back up to 39% (from 30% in 2021), but its actual volume took was on-par with the previous year, and just 2% above the five-year-average.
Combined sheepmeat exports have surpassed both last year’s total and the five-year-average for the year-to-date, albeit the later by just 1% despite the record lamb output. In terms of value, for the first three quarters of 2022 (latest data available), lamb exports returned $2.59 million, a record amount and 20% higher year-on-year. Total mutton export value for the year-to-September also appears to be a record at a touch above 909,000, up 16% on the previous year.
What does it mean?
It’s no secret that an economic downturn in some of Australia’s major international markets is likely on the cards in 2023, which could impact sheepmeat export values, and this along with increased supply will put downward pressure on domestic prices.
On the flipside, actual demand for Australian product isn’t going away, and in fact China, one of the large markets, could pick up steam as Covid-19 restrictions ease. Team this with an expectation that New Zealand (our biggest competitor) lamb production will fall, and there’s plenty of scope to maintain export volume.
Key Points
- Total lamb exports are likely to finish the year at a record volume, with the year-to-November volume 7% higher.
- Mutton exports have also increased, up 4% on the previous year for the first 11 months of the year.
- Lamb export value reached a record high for the year-to-September, up 20% on the same period last year.
Click on figure to expand
Data sources: DAWE
