{"id":12584,"date":"2014-09-23T00:00:00","date_gmt":"2014-09-22T12:00:00","guid":{"rendered":"https:\/\/www.farmersweekly.co.nz\/hunger-grows-for-sheep-meat\/"},"modified":"2014-09-23T00:00:00","modified_gmt":"2014-09-22T12:00:00","slug":"hunger-grows-for-sheep-meat","status":"publish","type":"post","link":"https:\/\/www.farmersweekly.co.nz\/news\/hunger-grows-for-sheep-meat\/","title":{"rendered":"Hunger grows for sheep meat"},"content":{"rendered":"Reading Time: <\/span> 3<\/span> minutes<\/span><\/span>

That figure represents a massive 53% increase on the year before, and comes as the traditional United Kingdom market experienced a 7% decline.<\/p>\n

This quantity easily places China as NZ\u2019s No 1 sheep meat market, even more than the combined European Union market, and also has NZ placed as the key supplier of sheep meat to China.\u00a0<\/p>\n

NZ sits ahead of Australia which exported 100,000t in 2013, and the China market has gone from only 4% of NZ\u2019s sheep meat trade in 2000 to 40% for 2014.<\/p>\n

With the global flock remaining on a slight downward slide in numbers, indications are that the ever tightening supply and continuing growth in Chinese appetite will ensure prices continue to remain firm for at least the next season.<\/p>\n

Rabobank sheep meat analyst Matt Costello said indications are that the NZ flock has now fallen below 30 million sheep, raising longer term concerns, but supplies this year remain more consistent and price patterns are emerging this season that indicate a greater evenness within the market for supplies to the growing Chinese market.<\/p>\n

\u201cLooking across both NZ and Australia there appears to be a smoother pattern within the market, without those real peaks and troughs we have seen in the past.\u201d<\/p>\n

An absence of any widespread climatic events in past months \u2013 aside from the more defined drought in the North Island \u2013 has meant producers have been able to pick up stock as required, while farmers have felt less compelled by weather conditions to force stock on to the market.\u00a0<\/p>\n

This relative stability in supply, and a market hungry for red meat, ensures analysts including Costello are optimistic about the Australasian sheep meat sector, at least in the immediate future.<\/p>\n

Much has been made about the growth in lower-value cut sales to China for use in hot pot cooking, a meal 66% of urban Chinese say they eat at least once a month. The result has been that lamb flaps that used to retail for about $1.50 only eight years ago have moved as high as $6.75\/kg, chasing the gap with lamb leg.\u00a0<\/p>\n

As an indication of how dynamic the Chinese market is, carcase export has also grown significantly in the past year.<\/p>\n

Quality and safety issues have halted expansion plans for some Chinese food outlets recently.<\/p>\n<\/div>\n

Survey work conducted shows that between 2008 and 2012 food safety concerns leapt from 12% of consumers claiming it to be a \u201cvery big problem\u201d to 41%.\u00a0<\/p>\n

It sits almost equal to concerns over corrupt officials, and the gap between rich and poor \u2013 neither of which have experienced the same lift in concern over the same period.<\/p>\n

Consumers have also been quick to punish outlets delivering substandard product.\u00a0<\/p>\n

The YUM company that owns McDonald\u2019s, KFC, and Pizza Hut outlets has been hit hard by quality issues as recently as July this year. Food safety issues last year had same-store sales tumble by 40% year-on-year, and brought rapid double-digit expansion rate to a near halt.<\/p>\n

Costello said such issues were motivating all participants in the supply chain, particularly Chinese companies, to have a more prominent role in supply chain integration. He pointed to schemes like Alliance\u2019s Grand Farms partnership, the high-profile Dalian-based red-meat distributor.<\/p>\n

Alliance marketing manager Murray Brown confirmed the company had plans to expand beyond the present product range with Grand Farms, and opportunities were also developing rapidly in China for online trading of meat products.\u00a0<\/p>\n

He maintained the rate of Chinese growth meant that as traditional markets got back on their feet post-financial crisis, some supply tension will come into the sheep meat market.<\/p>\n

\u201cThis should bring some stability to pricing for everyone, and take some of the volatility out of what we have seen in the past.\u201d\u00a0<\/p>\n

He agreed that tighter supplies of sheep in NZ had recently helped deliver some of that stability this season, with lamb prices remaining strong all season.<\/p>\n

\u201cThe issue will be when to we get to a price point that causes some resistance, but I don\u2019t think we are there yet.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Without a doubt it is the ramp-up in China\u2019s hunger for New Zealand sheep meat that dominates the dynamics of the industry today.\u00a0\nThe Chinese market has gone from zero to hero in a short time. Back in 2000, sheep meat exports to China barely registered, while to the year ended March, China sales were 158,000 tonnes, almost a six-fold increase on export volumes for 2008 and with little sign of slowing.\n\n\u2018This should bring some stability\u00a0to pricing for everyone, and take\u00a0some of the volatility out of what\u00a0we have seen in the past.\u2019\n\n","protected":false},"author":29,"featured_media":12585,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_FSMCFIC_featured_image_caption":"","_FSMCFIC_featured_image_nocaption":"","_FSMCFIC_featured_image_hide":"","footnotes":""},"categories":[3],"tags":[],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t