The latest market update published by the European Commission shows Chinese imports of sheep and goat products increasing by in the region of 50,000t for the first nine months of 2021.

Import volumes have been recorded at over 350,000t and while import volumes generally decrease in the final quarter of the year, they are still on target to break the 400,000t mark for the first time.

China is the dominant player on the global market in terms of sheepmeat imports and with volumes of 365,000t, it accounted for 38% of all sheepmeat imports in 2020.

New Zealand is the main supplier, accounting for in the region of 55% of imports in 2020, while Australia supplied 42% of import volumes.

Largest global market

The fact that these imports account for just 8% of total consumption in China shows the vast scale of the Chinese market.

Bord Bia reports that total sheepmeat production in China was recorded at a massive 4.92m tonnes in 2020, with this figure representing a 0.5% increase on the previous year.

According to the Department of Agriculture, the value of Chinese sheepmeat imports was worth $1.74bn (€1.47bn) in 2020.

China has become an increasingly attractive market for sheepmeat exports, with average prices for imported sheepmeat more than doubling over the last decade and reaching a record high in the first half of 2021.

Bord Bia reports prices averaging $2.09/kg (€1.77/kg) in 2009, with this average rising to $4.78/kg (€4.05/kg) in 2020 and hitting a high of $5.50/kg (€4.66/kg) in quarter one of 2021. This is an impressive average when you take into account that it includes some lower-value cuts.

Given all of these factors, it is not surprising that Irish processors are keen to progress market access

Given all of these factors, it is not surprising that Irish processors are keen to progress market access.

The Department of Agriculture reported at the start of September that formal protocols had been signed with Minister NI of the General Administration of Customs of China (GACC).

Minister for Agriculture Charlie McConalogue reported at the time that a number of technical steps remained before the GACC can include a list of approved plants on their website, while he explained the Department would also have to put in place systems and safeguards to ensure compliance with protocol requirements on eligible products. He highlighted that this would likely take a number of months.

Global import markets

As mentioned previously, China is by far the largest player in terms of sheepmeat imports. The US has developed as the second-largest import market over the last decade, following a sharp reduction in the volume of sheepmeat imported into the EU from New Zealand, while UK sheepmeat imports have also reduced.

Imports for the first nine months of 2021 are running at over 100,000t in the US and in the region of 50,000t in the EU and a similar figure in the UK.

Imports of New Zealand sheepeat are running at just 41,966t compared with 50,109t in 2020, with New Zealand likely to fill less than 50% of its tariff-free quota of about 114,000t.

While on the subject, it is a similar story in the UK, with imports running in the region of 37,000t up to October 2021. Malaysia is the only other market singled out, with import volumes in the region of 20,000t.

Global export players

China dominates global sheepmeat imports, but two players dominate global sheepmeat exports – Australia and New Zealand.

The European Commission reports that Australian lamb exports for the first nine months of 2021 are running in the region of 360,000t. This represents an increase of about 25,000t on the corresponding period in 2020.

Australia and New Zealand sheepmeat export volumes were running neck and neck with each other in 2020, but the increase in Australian export volumes has positioned it significantly above New Zealand export volumes, which are unchanged in the region of 325,000t for the first nine months of the year.

There is a major gap between exports from these two countries and the EU, where export volumes of 70,751t are running about 3,000t behind 2020 up to the end of September.

Meanwhile, exports from Uruguay and Ethopia are slightly higher at about 18,000t and 15,000t respectively.