china shipping

Despite lagging behind the record highs of 2019/20, lamb exports are showing all the right signs so far in 2021, with continued demand from the two largest markets. Total lamb exports for quarter one of 2021 are down 20 per cent year-on-year, and they are 15% below the five-year average for that time period. However the US, which makes up one quarter of all exports, imported a record volume of lamb for the month of March, and volumes to China, the other major market shareholder of Australian lamb exports, are well above the five-year-average for the year-to-date.

Year-to-date lamb exports to the US were down 13% for the January to March period, but volumes for the month of March were up 10% year-on-year, and increased 13% from February. As we can see from Figure 2, March lamb exports to the US rose to be outside the 70% seasonal range, and March saw the fourth largest total (for any one month) of lamb sent to the US on record. According to the latest Monthly US Lamb Market Update from Steiner, lamb consumption per capita was up 2.6% in 2020. Specifically, per capita consumption of imported lamb in the US has risen 75% since 2010.

China’s market share of Australian lamb is at 23% for the year-to-date, compared to just 17% for the same period in 2020, and the total volume for January to March is marginally ahead of the five year average. March lamb exports to China were down 19% compared to the previous year, however total sheepmeat volume to China, including Mutton, was up 13% year-on-year for the month.

Qatar, Australian lambs equal third-largest export market in 2020, has dipped considerably this year, from 7% of the market share to just 3%. In December, the Qatari government announced they would be scrapping the 50% subsidy on Australian lamb. As we pointed out here, prior to the subsidy being put in place in 2014, Qatar took 4% of Australian lamb, which means the current export share is even lower. In actual volumes, lamb exports to Qatar are down 62% for the first three months of 2021, compared to the same quarter last year. It is important to note however that Australian mutton exports to Qatar are actually up more than 100% for the year-to-date, and March mutton exports were 148% higher year-on-year.

Most of the market share lost from Qatar this year has moved to Papua New Guinea, who currently make up 6% of Australian lamb exports – compared to the 4% it took in 2020. PNG lamb exports are up more than 25% for the first quarter.

What does it mean?

Demand for Australian lamb overseas remains strong, with markets seemingly quick to pick up redirected supply. While total lamb exports have still declined more than total lamb slaughter so far this year, Australian mutton is filling supply in some markets, perhaps those looking for a lower-price alternative.

Have any questions or comments?

We love to hear from you!

Print This Post

Key Points

  • Total lamb exports tracking 20% lower for the year-to-date, but lamb exports to key market the US trending higher.
  • Lamb exports to China keep up with the record February, and were above the five-year average for March.
  • Lamb exports to Qatar are down 61% year-on-year, following the scrapping of the Qatari subsidies in December.%

Click on figure to expand

Click on figure to expand

Click on figure to expand

Data sources: Mecardo, MLA, Steiner

Make decisions with confidence- ask about our board packs, bespoke forecasting and risk management services

Have any questions or comments?

We love to hear from you!
Sheep

Here comes the rain again

Spring is coming to an end, but the consequences of the dry southern winter continue to drive the market. The search for weight is creating

Read More »

Want market insights delivered straight to your inbox?

Sign up to the mailing list to get regular updates to new analysis and market outlooks

Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published

Commodity conversations podcast cover image, a illustration of a sheep standing on a cow's back with grain either side
Listen to the podcast

Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.

Photo of a farmer surrounded by Merino sheep in dusty yards
Research: Analysis of the Australian sheep flock

In this report for LiveCorp and MLA, we analysed the historical trends in the demographics of the Australian sheep flock, examining domestic factors that influence farm-level enterprise decision making. 

Image of harvested grain pouring into a chaser bin
SERVICES AND CAPABILITIES STATEMENT BROCHURE

We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.