February 10, 2014

New Zealand's 2013 sheep meat export to China up fivefold

China is taking secondary cuts such as caps and flaps, taken from around the belly of the lamb, that were previously much cheaper or even destined for the pet food market.

The explosion in demand for these secondary cuts helped drive New Zealand's sheep meat trade to China to US$550 million in 2013, up around fivefold from 2010, and a big boost for a farm sector that has seen sluggish demand from traditional markets in Europe.

China is the world's largest sheep meat producer with a flock estimated at nearly 140 million in 2011, but output has been declining as farmable land shrinks due to urbanisation. Lamb has traditionally been consumed mainly in China's northeast, but a growing urban middle class in expanding cities wants more protein and has broader tastes.

However, even New Zealand's flocks might not even be enough to sate China's appetite, despite its sheep population of 31 million outnumbering its people seven to one. Fortunately, Australia, which supplies 35% of the world's sheep, aims to make up the difference.

Experts predict that China might be taken aback at the high prices for secondary lamb cuts, as lamb prices have skyrocketed around the world. Even offal costs are shooting up.