China’s beef imports up 17%, sheep imports down a quarter

Chinese imports of beef are up 17% to 184,000t compared to the same period in 2014, AHDB, the organisation for the English beef and sheep industry says.

Australia continues to be the largest supplier of beef to China, with a 38% share of the market, however it appears that other countries are starting to increase their beef presence in the Chinese market, such as New Zealand, Uruguay and in particular Argentina, it says.

Australian imports are back almost 10%, according to AHDB, at 69,000t and New Zealand is benefiting from a preferential tariff compared to Australia.

In the year to date, AHDB says that shipments from New Zealand up over a third on the year at 32,600t.

It also says that it’s likely that imports from the Kiwi country could rise for the rest of 2015, this on the back of an increase in slaughterings of dairy animals due to poor returns in the dairy sector.

Imports from South America have also showed a strong performance compared to the first half of 2014, it says with imports from Uruguay up 37% and from Argentina up more than three-fold.

Volumes from Canada had been trending upwards until last year, however, AHDB says that since then it would appear product has been diverted to the US, with Chinese imports down over a half compared to the first six months of 2014.

AHDB says that it appears that China has not resumed importing Brazilian beef after a ban imposed in 2012 was lifted last year, prompting fears that Australia and other countries would lose out.

Brazil is not the only country having looked to regain access for its beef and the US came close to getting it in 2014 and Ireland was successful earlier this year, it says while the UK is also looking for access.

This may mean that competition to supply the Chinese market could be much fiercer in the future, AHDB says.

Despite fears of high prices, which raised concerns at the start of last year about beef becoming too expensive for Chinese consumers, AHDB says that demand for imports is clearly still robust.

Unit prices have increased again this year but domestic beef production is unable to keep up with demand as the industry is faced with structural challenges and AHDB says that as a result, it is expected that China’s demand for imported beef will remain strong, in the medium term at least.

Sheepmeat imports to China down 

Meanwhile, imports of sheepmeat to China fell by almost a quarter in the first half of 2015 this was as increased levels of domestic production and stocks have kept a lid on demand, according to AHDB.

Sheepmeat imports fell by a quarter to 130,700t and volumes from New Zealand it says, the largest supplier of sheepmeat to China, fell by 22% on the year to 85,400t.

However due to larger declines in imports from other major suppliers, New Zealand’s share of the Chinese market grew to 65%, it says.

AHDB says that Australian imports fell 22% to 43,500t, shipments from Uruguay dropped to 1,600t, down almost three quarters on the first half of 2014.

Over 95% of the sheepmeat imported into China so far this year has been as cuts it says, as larger falls have been seen in imports of whole carcases.

According to AHDB, China has held an increasingly important role in the global sheep meat market over the past five years.

Therefore events there can have an effect on the UK market, despite the UK not currently having access to the Chinese market, it says.

Due to its huge population and rapidly expanding middle class, AHDB says that China has been the ultimate market for exporters of many products and commodities for a number of years.

It has been the largest producer of sheep meat in the world for a number of years and was traditionally largely self-sufficient, however, since 2010, AHDB says that Chinese sheepmeat imports have been increasing steadily and in 2012 it overtook France as the world’s largest importer.

Sheepmeat imports to China followed trends seen in other meats and dairy, increasing sharply in 2011, 2012 and 2013 following rapid urbanisation and growth of the more affluent middle class, it says.

However high prices for sheepmeat in China and low supplies of breeding animals have led local governments to offer subsidy schemes for producing more sheepmeat, it says.

As a result, AHDB says that domestic production has grown at the same time as imports have been increasing, leading to higher levels of stock in cold storage.

Meanwhile, a slowdown in growth in the Chinese economy and a drive to curb extravagance from the government has contributed to a slowdown in demand for meat in China, it says.

Domestic producers have been culling their breeding ewes and AHDB says that this should lead to tighter supplies in the long term, potentially leading to a resumption of increasing import demand.

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