Beef + Lamb New Zealand (B+LNZ) has just released the latest export statistics for New Zealand lamb, mutton and beef for the 2012–13 export year, which finished on 30 September 2013.
B+LNZ’s chief economist Andrew Burtt reports that exports to China have grown rapidly – from less than one per cent of total volume in 2010–11, to 10 percent in 2012–13. However, traditional markets remain the dominant source of revenue for New Zealand sheep and beef farmers, he says.
“The significant growth to China reflects: its growing strategic importance to the New Zealand red meat sector; the importance of high quality access to the market, such as that provided by New Zealand’s free trade agreement; and the risks posed by disruptions to the trade, as experienced in 2013.”
The EU and US remain New Zealand’s largest meat markets overall, with the EU accounting for 40 per cent of lamb exports and the US accounting for 48 per cent of beef exports.
The statistics show that in 2012–13, China became New Zealand’s largest single lamb market and largest single mutton market – and, so, the largest single sheepmeat market – importing 131,000 tonnes, compared with 74,000 tonnes into Great Britain.
China accounted for 28 per cent of lamb exports, 52 percent of mutton exports and 33 per of sheepmeat (lamb and mutton).
Though increasing, the average value of lamb exports to China trails well behind returns achieved from EU markets. The average value received from China was $4,800 FOB per tonne, compared with $9,000 per tonne from the EU and $11,500 from the US.
This reflects the product mix exported to the different countries. Exports to developed markets include a higher proportion of cuts that are case ready. Cuts exported to China will generally be further processed before being consumed.
The statistics show that in 2012–13, total New Zealand lamb exports increased by 18 per cent to 313,000 tonnes shipped weight, influenced by an earlier processing and exporting pattern than in 2011–12, says Burtt.
“The increase in volume was offset by a 16 per cent decrease in average value, resulting in total value of lamb exports falling marginally – 0.9 per cent – to $2.3 billion FOB.”
The EU remained New Zealand’s largest market region by volume, accounting for 40 per cent of exports.
North Asia, the next largest market region, accounted for 32 per cent of exports, up sharply from 24 per cent in the previous year and 17 per cent in 2009–10.
“All but a tiny proportion of New Zealand’s lamb exports are processed beyond carcase form,” he reports. “Ninety eight per cent of total New Zealand lamb exports were in bone–in or boneless cut form, with just two per cent exported as carcases; 99 per cent of chilled lamb exports were bone–in or boneless cut.”
Chilled lamb exports of 72,500 tonnes shipped weight remain just under 25 per cent of New Zealand’s total lamb exports, with the majority of chilled lamb (more than 70 per cent) being exported to the EU.
The average value of chilled lamb fell 22 per cent to $10,340 FOB per tonne, compared with a 19 percent decrease in the average value of frozen lamb exports – to $8,030 per tonne.
According to Burtt, a majority of New Zealand’s mutton exports now goes to China. “In 2012–13, 52 percent of New Zealand’s mutton exports were to China, with the next largest market being the UK, at eight per cent.”
Beef and veal
While beef and veal exports to China have grown rapidly, the US remains New Zealand’s largest beef and veal market by a significant margin.
“Beef and veal exports to the US accounted for 48 percent of total beef and veal exports in 2012–13. The average return received from China and the US for beef and veal was similar, at about $5,300 FOB per tonne,” he says.
“In 2012–13, total exports of beef and veal increased 4.6 percent to 367,000 tonnes shipped weight, as a result of increased production from cull dairy cows carried over into the 2012–13 season and the impact of drought conditions.”
The total value of beef and veal exports increased two per cent to $2.1 billion FOB.
Overall, receipts for beef and veal exports averaged $5,800 FOB per tonne, down 2.4 per cent on 2011–12 and reflecting the impact of the relatively strong New Zealand dollar.
North America accounted for 52 per cent of beef export volume and 48 per cent of export value – the same levels as in 2011–12. Shipments to North America are dominated by beef used in further processing.
Exports to the US increased 11 per cent to 175,000 tonnes worth $933 billion FOB.
Exports to Canada dropped sharply – by 27 percent.
North Asia, the next largest market accounted for 31 per cent of both volume and value for 2012–13, up from 26 percent a year earlier. Within this, China and Hong Kong combined accounted for 11 per cent in 2012–13, after representing just four percent of New Zealand beef and veal exports in 2011–12 and around one percent in previous seasons.
Exports of New Zealand beef to China increased nearly six–fold, from around 6,300 tonnes in 2011–12 to more than 36,000 tonnes in 2012–13. The average value of exports to China increased 15 percent to the same level as received from the US.