Search our website enhanced by Google.
Will high UK prices encourage New Zealand lamb imports?
Thursday, 27 May 2021
By Charlie Reeve
Prices
Lamb prices in New Zealand have been rising in recent weeks but still remain well below the high GB farmgate prices observed during the last few months. The gap between farmgate prices in New Zealand and the UK is currently in excess of £2/kg deadweight.
Seasonal trends from previous years indicate that this price gap will tighten, as increased volumes of new season lamb becomes available in the UK in the coming months, putting pressure on the UK’s domestic farmgate price.
The current high gap between UK and New Zealand prices would of course make the UK market more attractive to New Zealand lamb imports, if volumes are available.
Production
New Zealand production was reported to be up by 40% year on year during March due to favourable conditions, according to Beef & Lamb New Zealand. During Q1, lamb throughputs were up 4% on 2020 and 1% on the five-year average. These higher production figures in New Zealand will increase supplies available for export. However, the destination of these exports will be determined by global prices and demand levels from Asian markets.
Trade
UK imports during Q1 from New Zealand have dropped back below last year’s levels, to the lowest levels for Q1 during the last decade. Traditionally, Q1 has the largest volume of sheepmeat imports from New Zealand to the UK.
Looking at the first four months of trade in recent years, imports have been steadily declining year on year. However, during April, New Zealand exported 3,500 tonnes during the month, a 10% increase year-on-year, and likely a short-term response to the good returns available in the UK market.
So this may indicate slightly more imports from New Zealand in the coming months, especially if the price premium holds. However, with UK prices expected to drop back slightly in the coming months as supplies increase New Zealand may look to target other more attractive export markets.
Exports from New Zealand to the UK dropped back by 19% during the first four months of trade. By contrast, New Zealand sheepmeat exports to China have grown by 41% year on year, accounting for 63% of total exports.
Sign up for regular updates
You can subscribe to receive Beef and Lamb market news straight to your inbox. Simply fill in your contact details on our online form.
While AHDB seeks to ensure that the information contained on this webpage is accurate at the time of publication, no warranty is given in respect of the information and data provided. You are responsible for how you use the information. To the maximum extent permitted by law, AHDB accepts no liability for loss, damage or injury howsoever caused or suffered (including that caused by negligence) directly or indirectly in relation to the information or data provided in this publication.
All intellectual property rights in the information and data on this webpage belong to or are licensed by AHDB. You are authorised to use such information for your internal business purposes only and you must not provide this information to any other third parties, including further publication of the information, or for commercial gain in any way whatsoever without the prior written permission of AHDB for each third party disclosure, publication or commercial arrangement. For more information, please see our Terms of Use and Privacy Notice or contact the Director of Corporate Affairs at info@ahdb.org.uk © Agriculture and Horticulture Development Board. All rights reserved.