Papua New Guinea is now the third largest export market for Australian lamb with a 110 per cent lift year-on-year.
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And South Korea has slipped into fourth place with exports rising 58pc so far this year.
This is according to Meat and Livestock Australia's manager for market insights Dr Vereena Rooney who said establishing these nations as Australia's third and fourth largest lamb export markets is a display of Australian lamb's increasingly diverse export base.
Dr Rooney said there were several factors believed to be driving lamb demand in PNG.
"Recent strong foreign investment into the PNG mining sector, and a corresponding influx of migrant workers, is believed to have led to increased protein demands," Dr Rooney said.
"This scenario is supported by the cuts that PNG is importing, mainly lower value breast, flap and manufacturing lamb."
In addition, he said local PNG nationals with increased resources are believed to have driven some demand - they have a strong culture of consuming sheepmeat.
"This demand shift has also coincided with an increase in supply of Australian lamb - with production in the first half of 2022 up 2pc from the first six months of 2021, and up 8pc from the first six months of 2020," Dr Rooney said.
"Subsequently, exports have risen across the board over this period, with increases generally more pronounced in the more price sensitive markets, such as Papua New Guinea."
She said alongside higher supply, consumer interest in lamb has grown from a very low base in South Korea.
And while lambs is not traditionally a large part of South Korean diets, consumer interest is growing according to MLA's Global Consumer Tracker.
"This is especially among young people keen to try new and different cuisines," Dr Rooney said.
"Rising interest in lamb was seen during the pandemic as consumers sought "something different" and has also resulted from the growing camping trend - where barbecue lamb is a popular meal to enjoy."
Both lamb and mutton exports rose year-on-year to 37,648 tonnes.
And although mutton exports dropped by nine per cent to 12,622 tonnes, lamb exports rose 15pc to 25,026 tonnes.
China remains Australia's biggest sheepmeat exporter with total levels increasing by five per cent from year ago levels.
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Mutton exports to mainland China rose by eight per cent year-on-year to 5875 tonnes, while lamb exports fell by one per cent to 5438 tonnes.
It was South-East Asia which saw the largest increase in sheepmeat exports, with volumes in the region rising by 25pc from 2021 to 4792 tonnes - an additional 1630 tonnes.
And that demand is predicted to strengthen.
"Over the past six months, the increase in sheepmeat exports to South-East Asia is primarily driven by increases in mutton export to Malaysia, and lamb export to PNG," Dr Rooney said.
"Over the longer-term, economic growth in South-East Asia has made red meat relatively more affordable, and available to consumers.
"Given high projected growth rates in South-East Asia over the next decade, red meat demand will likely continue to grow in the region."
Dr Rooney said the positive news for lamb and mutton exports offers a window into 2023 for producers and exporters.
"The production cycle for sheepmeat is considerably shorter than that of beef," she said.
"Sheep flock and cattle herd numbers were both affected by droughts that ended in 2020, but sheep flock numbers could recover faster, and thus production has grown more quickly.
"The strong export volumes we are currently seeing with sheepmeat are likely to be replicated in beef exports going forward, as the cattle herd rebuild matures and production begins to more consistently rise."
She said even though the pace is slower for beef production, the underlying dynamic remains the same and, as shown in the recent State of the Industry report, Australian exports are likely to begin sustained rises as other major producing nations enter rebuilding phases.
