Chinese lamb imports will impact global supply

Chinese lamb imports will impact global supply

The increasing appetite in China for higher value cuts of lamb is likely to have a significant impact on global supplies, producers on both sides of the world have agreed.

A delegation from the UK sheep meat industry has just returned from a fact-finding mission to New Zealand where they met farmer, processor and stakeholder representatives to discuss the negative impact price volatility is having for sheep meat producers wherever they farm.

They agreed to continue to work closely together to try to better anticipate and understand the impact of volatility on their businesses, with increased market access also essential to spread the risk.

And they believe that the increasing demand for lamb, in particular higher value cuts, in China would play an important part in the global picture.

“New Zealand now has open access to the China market and it is creating a lot of opportunities for them which they are naturally excited about. There is a huge demand for sheep meat there and it is not just the cheaper cuts as may traditionally have been the case,” said Nick Allen, EBLEX director, who was among the visitors to the southern hemisphere.

“With a 1.4 billion population, it doesn’t need a huge percentage to have rising disposable income to see that the potential demand for higher value cuts is significant and this will impact on supply.

“This increased demand from the Far East will influence the global supply of lamb as New Zealand looks to take advantage of that market – something we cannot yet do. It means we could potentially avoid an unusually high flood of lamb cuts into the UK from New Zealand, as we got over a short period late last year.

“However, we need to work closely with our colleagues in New Zealand to try and anticipate spikes and troughs in supply caused by adverse weather patterns, among other factors. We must work harder to develop the sustainability of our industry while continuing to push for market access in countries we cannot yet sell into, including China.”

The Agriculture and Horticulture Development Board (AHDB), of which EBLEX is the beef and sheep division has just secured a dedicated representative in Beijing, through the China-Britain Business Council (CBBC) Launchpad agreement, to further work towards market access there.

EBLEX co-ordinated the delegation to New Zealand, which also included representatives from the National Farmers Union (NFU) and National Sheep Association (NSA). The group met with Beef and Lamb New Zealand and agreed there is an opportunity over the next six months for sheep meat producers, processors and exporters on both sides of the world to better understand market dynamics and to consider how more stable returns might be able to be generated in the future, improving the long-term viability of the sheep meat sector.

NFU livestock board chairman Charles Sercombe said: “Despite all the technology we have in this day and age, there is no substitute for face-to-face meetings. These were vital to gain a thorough understanding of the pressures the New Zealand sheep meat industry faces, and I appreciate how candid everyone we met with was.

“What has come across more strongly than anything else is the common challenges we share. This has reinforced my view that there is an urgent need for all parties in supply chains to work more closely together to ensure the best product for the consumer and a thriving and profitable industry which is able to adapt to the changing world marketplace. This is true whether you farm in the UK or New Zealand.”

Phil Stocker, chief executive of the NSA, added: “This trip was invaluable in both the UK and New Zealand sheep sectors learning more about the industry on both sides of the globe.

“Building closer relationships gives us the chance to complement and learn from each other, recognising that we are all part of a global farming community that can add value and improve efficiency by working together.

“While our countries are very different in terms of climate, populations and pressure on land, the challenges of profitability and increasing efficiency within the boundaries of good environmental management are shared. “

The Global Sheep Meat Forum, to be held in Brussels later this year, will provide another opportunity to continue the discussions on price volatility.

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