Meating the market
08 August 2018
Producers have been informed that the concept of ‘bigger is better’ may risk under-supply to some of Australia’s most valuable lamb markets in the future.
MLA’s Chief Marketing and Communications Officer, Lisa Sharp, speaking at LambEx this week, said producers need to be highly aware of consumer demand for lighter, leaner lambs. She said the current trend of supplying larger lambs meant the industry was potentially missing out on tens of millions of dollars annual profit.
Smaller households and changing eating habits are driving domestic demand for smaller lambs, a move also seen in the valuable European Union market.
Lisa told the almost 1,000 attendees at the MLA-sponsored event held at Perth this week that lamb carcase weights had increased by an average of 190 grams/year over the past 10 years resulting in large carcases with reduced average lean meat yield. This has led to challenges for processors, butchers and retailers supplying markets demanding smaller cuts.
In 2017-18, 14% of Australian processed lambs had 26kg (or above) carcases – in 2000 that percentage was non-existent.
With 70% of all sheepmeat now exported (or 60% of lamb) Lisa explained that understanding consumer demand of such a multitude of markets has never been more important.
Delegates were told Australia remains the single largest and highest value market for lamb with steady growth forecast. While larger lambs are sought by certain markets such as the United States, where lamb remains a niche but growing product, regions such as the Middle East and Europe demand a lamb similar to the Australian domestic market. If greater access is gained in Europe, demand will far outstrip Australia’s lighter carcase supply.
“To see sustainable returns, it is important to understand what makes the industry the most profit with lighter, leaner lambs sought by many high value markets,” Lisa said.
“The cost of overfat lambs is currently borne by processors but ultimately it is lost value for the industry.
“There is significant potential to reclaim some of that lost profit if the Australian sheepmeat industry moves in the direction of producing the right balance of lighter and leaner lambs.”
Lisa admitted that current pricing regimes offered no incentive, but there could be room for processors to offer a premium for lighter lambs.
Speaking about the Middle East market, where many WA-produced sheep are directed, Lisa said consumer insights showed these consumers valued freshness over all other attributes, underpinning the desire for live animals which can be locally slaughtered. Lisa also stated the certain markets, such as the UAE were seeing significant growth in chilled lamb. As the retail trade modernised, this was a trend expected to continue.
Find out more about Australia’s red meat markets at www.mla.com.au/market-snapshots
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