Domestic consumption


The domestic market is the single largest market for Australian lamb, accounting for 52% (or 204,000 tonnes cwt) of lamb production in 2010-11. MLA Market Information collects, analyses and reports on data and information about the domestic lamb market for the retail, foodservice and consumer sectors.

Consumer

  • Consumer demand for lamb (as gauged by expenditure estimates) has been expanding continuously since the early 1990s through to 2009. The tight lamb supply was particularly felt by consumers over the past year, with a 9% jump in retail prices during 2010-11 and intense competition from export markets impacted consumption.

  • Australian lamb utilisation is estimated to have decreased 10% to about 204,000 tonnes cwt, while expenditure on lamb during 2010-11 was estimated to have eased 2%, to $2.2 billion. 

Retail sector

Retail tracking data

  • Lamb had a 16% share of total fresh meat purchases at retail outlets in 2010-11 (Roy Morgan Retail Meat Purchasing Report).

  • The average weekly serves of lamb purchased in 2010-11 was 22 million. 

  • During 2010-11, retail lamb price increased against beef and chicken. The average retail lamb price surpassed the price of beef for the first time in March quarter 2011 and remained above beef price through to the September quarter 2011.

Butcher survey

  • Weekly butcher sales performance of lamb has softened since the second half of 2008 through to 2010-11, affected by the Global Financial Crisis (GFC). Reduced consumer sentiment during this period saw consumers tightened spending. The tight lamb supply also added pressure to consumer’s stringent budget, switching to alternative meat cuts.

Foodservice sector

  • The Australian foodservice market was estimated to have grown 8.4% to generate $42.1 billion during 2010 (Penfold Research based on ABS data). However, prospects for 2011 are less optimistic, with signs that the market slowed significantly during the first half of 2011.

  • The Australian foodservice market has been volatile in the past decade. Although real growth in takeaway services fell to -0.6% during 2010-11 (from 11% during 2009-10), the segment is expected to improve over the rest of 2011, as consumers pull back from higher priced restaurants in an effort to stretch their budget. 

  • Results from the latest Penfold Research’s tracking study on the Australian foodservice indicated that foodservice businesses have weakened since May 2009 – when the economy was in the depth of the GFC.

  • Most outlets described themselves as ‘doing OK’ indicating that the majority of foodservice outlets are in a stable state. Yet, some suffered less healthy conditions that contributed to slower sales.

  • The foodservice sector in Melbourne continued to be the most buoyant foodservice market on the eastern seaboard. Brisbane/Gold Coast businesses improved slightly in the May 2011 tracking, while Sydney’s were subdued after showing improvements in recent surveys.

  • In May 2011, the Australian foodservice sector was estimated to have utilised 231.1kg of meat/outlet per week, up 5% compared with the same time last year.

  • The result showed an improvement, boosted by higher volumes of relatively cheap poultry, but relatively low volumes. The growth in meat utilisation slowed and consumers have reverted to lower priced meats and cuts, including pork and poultry.

  • Poultry continued to be the most served meat in the Australian foodservice sector (86.5kg/outlet per week), followed by beef (64.8kg/outlet per week), lamb (26.8kg/outlet per week) and pork (34kg/outlet per week).

  • Of all major channels, fast food chains performed best in the May 2011 survey, with utilisation increasing to average 769.6kg of meat/outlet per week. The independent fast food segment was impacted most by the weaker market conditions, consuming only 120.6kg/outlet per week.

  • The contrast between the prosperity of fast food chains versus the decline of independents indicates the broad trend occurring across the industry. Large operators outperformed because of the advantages of scale.


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