Sheep meat prices heading downwards

National sheep and lamb over-the-hooks (OTH) indicators have been on a downwards trajectory since June, with saleyard prices also following the same trend. The national trade lamb indicator (NTLI) averaged 694¢/kg carcase weight (cwt), a 47¢/kg premium to the national medium trade lamb OTH indicator, which averaged 647¢/kg cwt.

While a lag between price trends seen at saleyards and movements in OTH indicators is not uncommon, the rate of decline in saleyard prices has been far greater, with the NTLI down 255¢/kg cwt on the record highs seen in March.

Processor demand for finished lambs has lifted in recent weeks, on the back of increasing optimism in the domestic market after a prolonged period of uncertainty. However, lamb supply continues to exceed demand, which has kept a lid on OTH indicators. Elevated lamb supply saw eastern states lamb slaughter for the week ending 11 September lift 10% on the week prior to 347,500 head, 6% higher year-on-year.

In response to this supply shift, national OTH indicators have eased, with medium trade and heavy lambs at their lowest levels since March 2019, reported at 647¢/kg cwt and 649¢/kg cwt, respectively, for the week ending 18 September. National light OTH lambs followed similar trends, tracking down to 653¢/kg cwt, an eight-month low.

At state level, the Victorian heavy weight lamb OTH indicator tracked down 150¢/kg cwt on year-ago levels to 675¢/kg cwt for the week ending 18 September, albeit this was strongest state price for the week. The indicator also regained a premium to light OTH lambs following a brief period where demand for finished categories was subdued. New South Wales saw a sharper decline, pushing down 168¢/kg cwt to 620¢/kg cwt, while South Australia eased 153¢/kg cwt to 630¢/kg cwt. The Western Australia heavy lamb OTH indicator remained consistent with year-ago levels at 670¢/kg cwt, however, it now sits above the national average – a contrast to last year, where it was reported 100¢/kg cwt below the national average.

The national medium OTH mutton indicator averaged 527¢/kg cwt for the week ending 18 September, up 16¢/kg on the same time last year. Interestingly, despite little movement year-on-year, eastern states sheep slaughter for the year-to-date has tracked 35% below 2019 levels.

With the national saleyard mutton indicator back on year-ago levels (down 12¢/kg to 525¢/kg cwt), despite a 59% drop in total yardings, mutton prices at the saleyard and OTH levels continue to be buoyed by tight supply, however, this has been met with equally subdued demand.

E-commerce platform allows farmers to sell lamb direct to consumers

In a time where Australian farmers are being challenged by adversity in every direction, a new e-commerce platform has been developed to bridge the gap between customer and farmer with a buy direct system. 

The PDLmarketplac e-commerce platform has been developed to provide lamb consumers with quality assured Prime Dorper Lamb directly from Australian farmers, with proceeds going directly to the farmer. 

The advantages of an e-commerce system like this are twofold; farmers get better returns by selling premium product directly to customers and customers get a better range of choice when buying lamb delivered directly to their homes. 

Each PDLmarketplace delivery is traceable to a specific farm and production system. The trading platform allows consumers to select their lamb based on unique preferences including; ethical farming, sustainable farming, quality and flavour ratings based on previous customer reviews and farm location. 

All Prime Dorper Lamb has to meet strict quality specifications about size, conditions and genetic background to be available for sale through the system. 

When purchasing Prime Dorper Lamb through the PDLmarketplace customers can learn about the farms and meet the farmers behind their lamb selection, providing a new level of engagement between consumer and farmer. 

PDLmarketplace project director, Joe Barnewall, believes that it is critical to develop a much closer customer-farmer relationship. 

“Farmers have been the lifeblood of the Australian economy since the foundation of this country and this is a chance and give farmers the better returns they deserve. By revealing the people behind the food and educating customers about farming systems and animal welfare, we can strengthen the mutual respect and understanding between the two.”

Tim Stevenson, president of the Dorper Sheep Society of Australia says supporting Australian farmers is important now more than ever.

“With the drought in Eastern Australia, any way for professional producers to become more efficient must be a great thing. Meat that is handled and transported less has a smaller environmental foot print. PDLmarketplace does this and more.” 

Tim also shared that the project, endorsed by the Dorper Sheep Society of Australia, is one of the first of it’s kind. “The livestock industry in general has been left behind in its uptake of technology. This is the first for a breed society to partner with a commercial operator to provide benefits for the members by creating a unique process to sell their product directly to consumers. The DSSA is excited for and proud of the PDLmarketplace.”

Prime Dorper Lamb Farmers like Donna Emmerton of Downs Dorper Lamb are excited by this new opportunity to sell their product. “I think I speak for the majority of Prime Dorper Lamb farmers when I say things have been really tough for the past five to ten years and having a potential system like this that could give us some stability and the prospect of a better outcome is really exciting.”

The PDLmarketplace is a project operated by a Brisbane based team with support from The Dorper Sheep Society of Australia. The initial launch is for the South-East Queensland consumer market with expansion to Victoria in early 2020 leading up to Australia Day. 

Input sought on Middle East sheep exports

A discussion paper outlining policy options for sheep exports to, or through, the Middle East during the northern summer months is now available for stakeholder comment.

Minister for Agriculture, Bridget McKenzie, said that live sheep exports were an important part of Australia’s agricultural sector, and underpinned 3,450 jobs across rural and regional Australia.

“The export from Australia of live sheep shipped to, and through, the Middle East resumed on September 23 of this year after the Department of Agriculture prohibited these exports during the northern summer.

READ MORE: Improving oversight in live animal exports

“Feedback on the discussion paper will inform a Regulation Impact Statement (RIS), which will determine the future regulation of live sheep exports to, or through, the Middle East during the northern summer months from 2020 onwards.

“The discussion paper outlines four proposed policy option ideas.

“We are seeking input from stakeholders on the potential economic and regulatory impact of each idea but also welcome alternative options.

“I urge anyone who has a stake in Australia’s live sheep export industry to jump online and have their say on the discussion paper.”

In 2017–18 Australia exported around 2 million live sheep valued at over $259 million to trading partners wanting our high-quality live sheep.

Improving oversight of live animal exports

An independent inspector-general of Live Animal Exports to oversee regulation of the industry is a step closer today with the Bill to establish the position as a statutory appointment passing the Senate.

Agriculture Minister, Bridget McKenzie, said the community deserved greater assurance that animal welfare outcomes for export livestock were being met and monitored.

“Australia’s livestock export industry is an important contributor to our rural and regional communities and to our national economy valued at $1.7 billion and supporting thousands of jobs,” Minister McKenzie said.

“It’s a legitimate trade, however, it won’t be conducted at the expense of animal welfare standards.

READ MORE: Minister moves on sheep exports

“This legislation is concrete proof of this government’s continued commitment to improving the trade—making sure the trade is well regulated and above board.

“Support for the Inspector-General of Live Animal Exports Bill 2019 means there’ll be an entrenched independent check on the Department of Agriculture’s application of the regulations and its exercise of power.

“Our livestock export system is already world class and the Inspector-General will only enhance that. I am confident that the Bill will pass the House of Representatives and become law.

“Once it does I will appoint a suitably qualified person to make sure the system is operating as it should—driving positive change in the industry, improving regulator performance and providing greater confidence to the general community about livestock exports.”

Australian lamb slaughter to decline in 2019

Australian lamb slaughter is forecast to reach its lowest level since 2012 as poor conditions that impacted 2018 are expected to continue to affect sheep meat supply this year, according to Meat & Livestock Australia’s (MLA) 2019 Sheep Industry Projections.

Lamb slaughter is forecast to decline 7 per cent in 2019 to 21.2 million head, while sheep slaughter is predicted to be down 16 per cent, to 8 million head, underpinned by substantial drops in marking rates and the culling of large numbers of ewes and ewe lambs.

The national flock is estimated to have declined by over 4 million head, or 6.1 per cent, to mid-2018 and is forecast to experience a further decline of 3.7 per cent by mid-2019 to 65.3 million head, as many producers are forced to continue destocking as they wait for a turnaround in the weather.

The significantly reduced breeding flock and widespread rainfall decencies, suggest fewer joinings than usual and a continuation of below-average lambing rates experienced in 2018.

MLA’s Market Intelligence Manager, Scott Tolmie, said many producers will be hoping for some consistent rainfall this year to help alleviate some of the pressures associated with high feed costs.

“Unfortunately, the current Bureau of Meteorology (BOM) three-month outlook does not point to an immediate reprieve from the current hot and dry conditions,” Tolmie said.

“Considering the substantial moisture deficiencies apparent in many regions, particularly New South Wales, any improvement in conditions would require consistent above-average rainfall over the coming months.”

Tolmie said both sheep and lamb carcase weights were impacted by the tough conditions and high cost of feed in 2018, and this is expected to continue in 2019 with feedstocks depleted and feed demand to remain high until conditions improve.

“The average lamb carcase weight is expected to remain around 22.4kg/head in 2019 while the national average sheep carcase weight is expected to stabilise in 2019, at 23.6kg/head,” Tolmie said.

“A fall in slaughter and carcase weights is driving the 7 per cent forecast decline in lamb production for 2019 to 475,000 tonnes carcase weight (cwt). Mutton production will likely see a steeper drop of 16 per cent to 188,000 tonnes cwt.”

Tolmie said looking beyond the current rainfall deficiencies, a variety of indicators point towards 2019 continuing to be a positive year for sheepmeat prices.

“Fortunately, robust international demand and a low Australian dollar will continue to support Australian exports and, in turn, domestic saleyard prices. Records were broken in 2018 as markets around the world competed strongly for Australia’s high quality sheepmeat,” Tolmie said.

“The expectation for supply, and consequently exports, to decline in both Australia and New Zealand will likely see global competition for sheepmeat intensify in 2019. The conditions that drove strong prices for well-finished stock last year look likely to remain in place in 2019, particularly while conditions remain dry.

“Sheepmeat supply out of Australia and New Zealand – which account for more than 70 per cent of global trade – has been unable to keep pace with strong global demand, led by China in 2018.”

Tolmie said in 2018, Australian lamb exports increased 7 per cent year-on-year to a record 267,000 tonnes shipped weight (swt), while mutton shipments jumped 23 per cent to 180,000 tonnes swt.

“Reflecting a reduced flock and limited supply, 2019 lamb exports are forecast to contract 8 per cent to 247,000 tonnes swt, while mutton is projected to fall 16 per cent to 151,000 tonnes swt,” he said.

Lamb wins big at Sydney Royal Taste of Excellence Awards despite drought

Lamb entries have defied Australian drought conditions to be named the winner of the 2018 Dick Stone perpetual trophy at the Sydney Royal Taste of Excellence Awards.

The trophy was won by Victoria’s Woodward Foods Australia for its export grade Lamb (USA).

The awards night was held at the Sydney Showground on the 21st of September.

The Dick Stone perpetual trophy is decided amongst the championship winners to emerge from the Branded Meat section of the coveted Sydney Royal Spring Fine Food Show held in September.

READ: Report shows Australia is the world leading exporter of lamb

This is the first year the trophy has been expanded to include beef, lamb and pork classes presented to the expert judges.

Chair of the Sydney Royal Spring Fine Food committee and Royal Agricultural Society of NSW councillor, Lachlan Bowtell, said this year’s competition was a testament to resilience.

“Even through the ravages of drought Australian lamb producers have delivered yet again,” said Bowtell.

“The high quality and flavours of the lamb presented to the judges this year made their role even more difficult.

“The Sydney Royal Fine Food Awards aim to reward excellence and this year was a true testament to the commitment and passion of not only lamb, but beef and pork producers, at times under dire circumstances,” he said.

Chair of judges in the Branded Meat competition George Ujvary said the overall quality of beef exhibits this year was very high and it was interesting to see the gap between the marbling quality of grass fed and grain fed beef exhibits closing yet again this year,” said Ujvary.

“The marbling of Wagyu exhibits this year was exceptional and flavour across all categories was very good.

“In the lamb competition, the standard of some exhibits was exceptionally high this year despite the conditions seen across the country which presented a number of challenges to producers,” he said.

“The top exhibits were sweet in flavour, extremely tender and exceptional in mouthfeel and appearance.

“Whilst the pork competition is still in relative infancy, the standard of competition was high and we all look forward to seeing this competition develop in the coming years,” said Ujvary.

During the competition 11 gold medals were awarded across seven classes in Branded Meat.

 

Australia the largest red meat exporter – report

Australia is the leading supplier of red meat to the world and Australians are among the highest red meat consumers according to a new report.

The Red Meat Advisory Council (RMAC) has released State of the Industry 2017, the first-ever snapshot of the value of red meat industry to the Australian economy and community.

In 2016 Australia was the largest exporter of beef and the second largest exporter of sheepmeat; and the world’s third largest livestock exporter.

Not only does Australia lead the world in selling meat, Australians are some of the highest consumers of red meat in the world, eating four times the average amount of beef and six times the amount of sheep meat compared to the global average.

RMAC Independent Chair, Don Mackay, said the State of the Industry 2017 demonstrates for the first time the key part red meat plays in the Australian economic success story, from our plates, to our jobs and our businesses.

“No industry has a more important place in society than an industry that feeds its people and sustains and improves their way of life,” he said.

“We have achieved turnover growth of 11 percent, contributed $18 billion to Australian GDP, sustain 405,000 direct and indirect jobs and feed 24 million Australians day in and day out.

“Our industry continues to work for our rural and regional jobs, accounting for almost a quarter of agrifood jobs in Australia.”

The report shows the value of Australian red meat and livestock exports increased by almost $6b over the past five years from $9.2b in 2011-12 to $15.1b in 2015-16.

It also showed that a once niche industry in goat meat has experienced a significant boom with Australia now a leading supplier of global goat meat, enjoying a recent price increase of 177 per cent and exporting over 27, 000 tonnes of goat in 2016 alone.

Mackay said the State of the Nation 2017 demonstrated the need for government to show leadership in food and farming policy.

“Our industry’s success is Australia’s success. As an industry, we are responsible for far too many Australian businesses and Australian jobs for government to be cavalier about our industry,” he said.

 

Value key to beef & sheepmeat exports to China: report

China’s dominance in world meat trade is set to grow out to 2020, albeit at a slowing rate, seeing opportunities for Australia’s beef and sheepmeat exports to China come from extracting value, rather than volume growth in an increasingly competitive market.

This is the key finding from Rabobank’s recently-released paper, Australian Red Meat Exports to China, which examines the implications of China’s growing animal protein demand – as forecast in Rabobank’s report China’s Animal Protein Outlook to 2020 – on Australia’s beef and sheepmeat exports to China.

Rabobank forecasts that while China is expected to import (in total) an additional 800,000 tonnes of beef and 50,000 tonnes of sheepmeat by 2020, this will only lead to a moderate increase in Australia’s red meat exports to China.

Rabobank senior animal protein analyst Angus Gidley-Baird (pictured) says Australian beef and sheepmeat exports to China exploded in 2012 and 2013, however, since that time, Australia’s market share has been eroded by increasing competition, seeing exports return to more ‘normal levels.

With Australia “no longer the only player in the Chinese market”, Mr Gidley-Baird says the Australian red meat industry needs to “temper its expectations” as it cannot directly compete with others in the mass market.

“In the beef sector, competition into China has really stepped up with Brazil regaining access for frozen beef in mid-2015, while Uruguay and Argentina have also expanded their export programs,” he says. “And competition could increase further if the US gains direct access to the Chinese market, which is a distinct possibility.”

Mr Gidley-Baird says while most of Australia’s competition in the Chinese sheepmeat market comes from China’s own domestic production, with China having the world’s largest sheep population, New Zealand is also a key supplier into the Chinese market.

“With China exploring other markets and alternative supply sources, Australia needs to create a strong value proposition – rather than focus on chasing volumes – to differentiate the quality of its product and command a slightly higher price,” he says.

“To give the Chinese consumer a reason to purchase Australian product at a slightly higher price than our competitors, we need to tangibly demonstrate food safety, quality, traceability, reliability and freshness,” he says.

Australia’s ability to supply chilled product, something no other country is able to do, also creates a higher-value proposition to the Chinese consumer, Mr Gidley-Baird says.

With most of the opportunities stemming from the upper-end of China’s middle-income class, Mr Gidley-Baird warns that while income growth is set to continue, consumers remain price sensitive.

“Caution must be exercised not to overprice the value of Australian beef and sheepmeat, but rather to price ourselves sensibly as per capita consumption remains relatively low,” he says.

NZ beef and lamb awards announced

The producer of New Zealand’s most consistently tender and tasty lamb in the last ten years has been announced today at the Beef + Lamb New Zealand Golden Lamb Awards, aka the Glammies.

For the past 10 years, the Glammies competition has sought out the country’s top lamb based on a scientific assessment and then taste. This year, the results from the past decade were collated to determine Robert Gardyne from Oturehua, Central Otago as the Producer of the Decade.

Having been a finalist in 2007, 2009, 2010, 2011, 2012, and the 2016 Grand Champion, Gardyne is no stranger to success. He has farmed for 52 years and believes his success is down to experience and practice.

“Consumers are now much more interested in the food they eat and where it comes from. Reflecting on the past decade, a lot of effort has been put into the management and genetic makeup of the animal to fine-tune the lamb we produce. Gaining an award like this is a huge thrill and gives me confidence in what is to come,” says Gardyne.

Following an independent assessment for yield, tenderness, succulence and colour the top 20 finalists were found and sent to be judged by Beef and Lamb New Zealand Ambassador Chefs in the Grand Final at the Wanaka A&P Show.

Forbes & Angus Cameron from Ashhurst, with their Growbulk processed at Alliance Dannevirke, outshone the 166 entrants in the 2017 competition and were announced as the Beef + Lamb New Zealand Golden Lamb Awards 2017 Grand Champion. This is a remarkable achievement for Forbes & Angus Cameron who also won the beef equivalent competition, the Beef + Lamb New Zealand Steak of Origin, in 2015.

Adding to the day’s celebrations, Matt & Lynley Wyeth from Masterton were awarded the 2017 People’s Choice Award and Countdown Supermarkets took out the title of Glammies 2017 Retail Winner.

Four of our nation’s top athletes and Beef + Lamb New Zealand Iron Maidens Lisa Carrington, Sarah Walker, Sophie Pascoe and Caroline Meyer (nee Evers-Swindell) were at the competition to pay tribute to New Zealand sheep farmers.

The competition is sponsored by Zoetis and Elanco and supported by Alliance Group, ANZCO Foods Canterbury, Ashburton Meat Processors, Auckland Meat Processors/Wilson Hellaby, Blue Sky Meats, Cabernet Foods/Kintyre Meats, Harris Meats, Oamaru Meats, Progressive Meats, Silver Fern Farms and Taylor Preston.

2017 Beef + Lamb New Zealand Golden Lamb Awards results:

Producer of the decade (2007 – 2017): Robert Gardyne, Oturehua

2017 rand Champion: Forbes & Angus Cameron, Ashhurst (Growbulk)

Processor of the Grand Champion: Alliance Dannevirke

2017 Retail Winner: Countdown Supermarkets (South Suffolk/Romney from Ruakiwi, Kaikohe)

2017 Peoples’ Choice: Matt & Lynley Wyeth, Masterton (Highlander/Primera), processed at Silver Fern Farms Takapau

 

Thomas Foods set to pack on the beef

South Australian meat processor, Thomas Foods International says it will boost its beef processing capacity by up to 25 per cent with a new beef boning facility.

Thomas Foods has an annual revenue in excess of $AUD1billion and is Australia’s largest family-owned meat-processing company.

It currently supplies a range of retail outlets including Coles, Woolworth’s, Costco and also Aldi.

According to the company, this $AUD25 million upgrade of its Murray Bridge abattoir will boost the company's beef processing capacity by a quarter and will see the creation of an additional 200 jobs.

“The new facility will use the latest technology for refrigeration, conveying, sortation, cryovac packing and hygiene,” Thomas Foods CEO David McKay said.

"It will be one of our company's biggest investments," he said.