China mutton demand 119pc above five year March average

January 2023 was the strongest mutton export volumes to China on record for January, February 2023 was the strongest February on record and now March 2023 has set an historic record for that month.

Overall, March 2023 has seen the strongest monthly total export flows of Australian mutton since November 2019 with 21,510 tonnes swt consigned over the month.

While exporters were already pleased with February's sheepmeat export numbers, March saw figures blow out by an extra 38 per cent.

Compared to the to the five-year average pattern for March the current volumes are running nearly 55pc above the average seasonal pattern.

While lamb exports are on the up as well, increasing 10pc from February to March 2023 to see 25,149 tonnes swt exported offshore, export flows have closely tracked the pattern set by the five-year average trend, according to market analyst, Matt Dalgleish.

"Total flows are about average despite the two top lamb export destinations for Aussie lamb, the USA and China, both performing below trend over March," he said.

"Compared to the mutton export flows running significantly above trend, the current lamb export trade appears somewhat lacklustre.

"At least it isn't below the average seasonal pattern."

Lamb exports to the US dipped by 11pc during March to see just 4,836 tonnes shipped.

This is a level 14pc below the five-year average for the month.

There was a modest gain of 8pc in China who received 4,867 tonnes of Aussie lamb.

"The Chinese flows represent levels that are nearly 9pc under the seasonal average for March, based on the average flows seen in March over the last five years," Mr Dalgleish said.

Lamb exports to other destinations (excluding USA and China) have helped the total flows stay on the average pattern with volumes in March lifting by nearly 21pc from the levels seen exported in February.

March saw 15,446 tonnes of lamb exported from Australia to a mix of other destinations, which is 13pc above the average flows seen during March, based on the last five years.

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Mutton continues to be the dominant meat of choice for export.

Underpinning the strong overall mutton export results is a huge lift in demand from China.

There were 9,533 tonnes of Aussie mutton sent to China over March 2023, nearly 49pc higher than the already strong flows seen in the prior month.

It was back in November 2019 that mutton flows to China from Australia were greater than they are currently.

Comparing the flows for March to the five-year average pattern for March, the current mutton demand in China is running 119pc above the average.

According to Mr Dalgleish, Malaysia has also begun the 2023 season is solid form, with regard to Aussie mutton demand.

"There was 2,639 tonnes shipped to Malaysia, a 9pc lift on the flows seen in February and nearly 50pc higher than the five-year average flows usually seen into Malaysia over March," he said.

Several Middle Eastern destinations also saw strong mutton demand growth too over March from Australia pushing the tally for all other destinations (excluding China &USA) to 10,561 tonnes swt.

This level represents flows that are a 32pc gain on volumes seen over February 2023 and is 33pc ahead of the March average, based on the last five-years of trade.

In contrast, New Zealand's exports have taken a dive in its traditional market of the UK with the amount of sheep meat exported in February being the lowest for that month in more than 35 years.

New figures from the NZ Meat Industry Association (NZMIA) show overall exports dropped almost a fifth compared to last year.

NZMIA chief executive Sirma Karapeeva said there was "real pain" in the UK market as food inflation in the UK was hitting around 17pc.

The drop in exports is concerning for our neighbours as traditionally the UK is one of New Zealand's most lucrative markets for chilled lamb.

Ms Karapeeva also reported that demand from China for NZ sheepmeat had not picked up as expected.

On the home front, Rural Bank's March Insights report says mutton prices have been volatile.

The report says that having successfully rebuilt flocks in recent years, producers are now turning off older ewes in greater numbers while also looking to purchase fewer sheep for restocking.

Pressure on prices could continue through autumn as drier conditions will likely see further culling of older stock.