In 2023, UK sheepmeat imports totalled 37,900t from New Zealand (NZ) and Australia.
According to the Agriculture and Horticulture Development Board (AHDB), NZ and Australia provide the UK with the majority of its sheepmeat imports.
While trade deals with Australia and NZ commenced in May 2023, imports from the latter fell last year, due to a structurally declining sheep flock and changing export destinations.
However, Australia has seen higher production levels through 2023, consequently pressuring prices and causing them to fall.
According to AHDB analyst Isabelle Shohet, this has increased their international competitiveness, coupled with the free trade agreement and a weaker-than-expected Asian demand, and has boosted imports from Australia into the UK for 2023.
Levels of imports into the UK hinge on trade with China, the Middle East, and the United States, as the main destinations for Australia and NZ.
Shohet noted that events such as Chinese New Year and Ramadan drive demand for sheepmeat, and if these events witness lower than expected demand, then the product will look for a home on the international market.
The AHDB analyst said industry reports suggest that Chinese New Year orders were “lower than expected due to weak economic prospects, dampening desire to spend during the festival period”.
The United States is also an important destination, as the AHDB has noted that with export volumes in recent months at record highs for the November to January period, consumption levels remain stable despite continuing economic pressures.
New Zealand
AHDB has said sheepmeat imports from NZ have fallen for 2023, to total just under 26,500t.
This is a fall of 6,000t (19%) from the total for 2022, as the market share of NZ imports dropped from 60% to 55% as a result.
Frozen sheep legs saw the largest drop in import volumes of any product category from 2022, with a fall of 3,050t to 14,150t for 2023.
The AHDB recorded that fresh/chilled sheep legs were the only category to see growth, of nearly 850t from 2022 to 2023, to total 13% of sheepmeat imports.
Shohet said that production in NZ has “started off the year slightly higher than 2023”, with hotter weeks in early February contributing to some drought-related destocking in both islands.
She added there are some concerns on the number of lambs available for slaughter, and therefore export.
“Industry commentary suggests that pressures on the number of lambs available to kill in recent weeks has provided some strength to prices, but farm margins remain lower than usual,” Shohet added.
Australia
Imports from Australia saw growth in volumes in 2023 compared to the previous year, totalling 11,400t for 2023, an increase of 1,800t from 2022.
Acording to the AHDB, this year-on-year increase came from increased volumes in the second half of the year, following access from the free trade agreement.
Looking into the products entering from Australia, Shohet noted the volume of frozen sheep legs is considerably smaller than that of NZ, at 1,700t, which has fallen by nearly 1,500t from 2022.
AHDB analysis has indicated Australian lamb slaughter is expected to climb slightly from its record-breaking high for 2023, especially in the first half of the year, with a higher carryover.
However, they noted production in the second half of the year looks to be lower, as the elevated slaughter numbers for last year have eaten into its production capability for 2024.
“One limitation to this remains Australia’s slaughter capacity, which is currently approaching its maximum levels,” the AHDB analyst added.