Record high returns for New Zealand beef in first half of the 2014-2015 season

Strong demand and a weaker New Zealand dollar against the US dollar led to record high returns for beef in the first six months of this season, with the average per tonne value up 28 per cent, compared to the same period last season. Meanwhile, the total value of lamb exports rose slightly, despite lower export volumes.

October 2014 to March 2015 exports

Beef + Lamb New Zealand (B+LNZ Ltd) compiles lamb, mutton and beef export statistics for the country. The following is a summary of the first six months of the 2014-15 meat export season (1 October 2014 to 31 March 2015).

Lamb exports
New Zealand lamb exports decreased by 2.9 percent in the first six months of the 2014-15 season, compared with the same period last season.

Lamb exports to the European Union, the largest market region for New Zealand lamb, were up 3.9 percent, to 68,700 tonnes shipped weight, in the first six months of 2014-15 compared with the same period last season. Exports to North Asia were down 8.5 percent, to 47,500 tonnes shipped weight, mainly driven by lower exports of carcases to China. Shipments to North America and the Middle East were up 2.0 and 0.9 percent, respectively.

Over the first six months of the season, lamb exports averaged $8,870 per tonne, up 5.2 percent on the same period last season. The total value of lamb exports rose 2.2 per cent to $1.36 billion, despite lower export volumes.

Mutton exports
In the six months to March 2015, New Zealand’s exports of mutton decreased by 18 per cent to 51,000 tonnes shipped weight. This reflected lower mutton production in 2014-15 compared with the elevated production levels of 2013-14, when dry conditions and dairy expansion saw more ewes processed. Shipments remained 9.2 percent above the five-year average for the period October to March of 46,700 tonnes.

Exports to North Asia slowed, while exports to the European Union, South Asia and North America increased in the first six months of 2014-15. Exports to China, the largest export market for mutton in North Asia, fell 30 per cent to 31,600 tonnes shipped weight.

In the first six months of 2014-15, the total value of mutton exports decreased by 18 per cent, to $273 million, due to the lower volumes. The average value of mutton exports remained unchanged (+0.4 per cent) at $5,350 per tonne.

Beef and veal exports
For the first six months of the 2014-15 meat export season, New Zealand beef and veal exports reached 212,100 tonnes shipped weight – up 12 percent or 22,600 tonnes on the corresponding period last season. It reflected a high and early cattle processing season – particularly in relation to cull cows – and strong global demand for beef. This increase in shipments was mainly due to consistent high monthly volumes exported to the two main markets for New Zealand beef – the US and China – while volumes to other main markets decreased. Exports to the US increased by 33 percent to 122,200 tonnes shipped weight, while exports to China increased by 21 percent to 21,000 tonnes in the first half of 2014-15.

Value of beef exports, excluding veal to USA
Note: The graph represents the value of beef exports to the US for the past four seasons. The grey areas represent the value of exports from October to March and the green areas the value of exports for the rest of the year – from April to September.

The increase in shipments came predominantly from processing beef (+23 percent) primarily used as an ingredient for ground beef products such as hamburgers, while exports of boneless cuts decreased slightly (-0.8 percent). Processing beef and boneless cuts accounted for 54 and 34 percent, respectively, of total beef and veal export volumes in the first six months of the 2014-15 season.

Strong demand and a weaker New Zealand dollar against the US dollar pushed the average per tonne value of beef and veal exports up by 28 per cent, to $7,540 per tonne, compared with $5,890 in the corresponding period last season. The average value of New Zealand beef and veal exports to the US and China increased by 40 and 21 per cent, respectively.

In the six months to March 2015, beef and veal export returns reached a record high of $1.60 billion – up 43 percent or $480 million on the corresponding period last season.

Supplied by B+LNZ Ltd. All values quoted are FOB (free on board) and in New Zealand dollars.

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