New Zealand’s red meat exports dropped by almost a fifth in February
New Zealand exported red meat products worth $885 million during February 2023, a decline of 18 per cent compared to the same time last year, according to an analysis by the Meat Industry Association.
Exports to most of New Zealand’s top 10 markets decreased, including a significant drop in sheepmeat to the United Kingdom.
Sirma Karapeeva, MIA chief executive, said the drop in export values from the very high levels in 2022 was due to tight global economic conditions.
"There was a major increase in export values for both beef and sheepmeat from mid-2021 to mid2022, driven by the global demand for protein and high levels of consumer spending.
"That resulted in record per kilogram export values in the middle of last year, and the drop in values of the last three months means that we are back at mid-2020 levels.
"There has not yet been any jump in demand from China following the lifting of COVID-19 restrictions in December. It appears that Chinese consumers are being cautious and a significant spending recovery remains on hold.
"This data also underscores the need for sensible and practical regulatory settings in areas such as immigration, freshwater, biodiversity and carbon farming.
"As they currently stand, these regulations put significant strain on the sector and add unnecessary costs at a challenging time".
Sheepmeat exports to both the UK and the EU were well below pre-pandemic historic levels for the time of year. Volumes to the UK were down 43 per cent to 2,410 tonnes compared to last year, with value decreasing 61 per cent to $23 million.
This was the lowest volume of exports to the UK in February for more than 35 years and the lowest value since 1989.
The UK market for lamb is continuing to struggle in the face of the country’s difficult economic conditions, with food inflation hitting 17 per cent in February and new supermarket entrants strongly focused on beating traditional retailers on price, while not compromising on quality.
Data from the UK’s Agriculture and Horticulture Development Board (AHDB) has shown that retail spending on lamb fell by 7.4 per cent by value and 16 per cent by volume in February compared to a year earlier, highlighting the difficult economic conditions.
The overall volume of New Zealand sheepmeat exports was down 10 per cent compared to February 2022, with value dropping by 27 per cent.
However, sheepmeat to the US was positive, with the volume up by eight per cent to 2,608 tonnes, and value up nine per cent to $46 million.
Volumes to China also increased by four per cent but the value was down by 19 per cent to $138 million. The average free on board (FoB) value of sheepmeat exports to China was $6.28/kg, $1.70 less than February last year.
The Netherlands and Belgium also saw increases in exports by 24 percent (to $41 million) and five percent respectively.
New Zealand beef exports rose by two per cent overall but value dropped by 18 per cent. This was in the wake of record values during 2022, with February 2023 values comparable to those in the first half of 2021.
Beef export volumes to China and the US were up eight per cent and seven per cent respectively. However, the value dropped by 15 per cent to China, to $147 million, and by 19 per cent to the US, to $115m.
The average FoB value for beef for China was $7.87/kg compared to $9.98/kg last February, and for the US it was $7.89/kg compared to $10.46/kg.
Beef exports to China still remain well above pre-African Swine Fever (ASF) and pre-pandemic levels, suggesting that beef has become a more permanent part of Chinese consumers’ diets. Volume and value of beef exports to the other major North Asian markets of Japan, Korea and Taiwan, declined.
Overall, fifth quarter exports also saw an increase, up nine per cent to $187 million.
The increase in fifth quarter performance included tallow exports of $40 million, a 32 per cent increase on 2022, driven by demand for its use in biodiesel manufacturing.
The highest demand was from the US, with $28 million, and Singapore, with $11 million.
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