The global demand for mutton

The quiet achiever in Australia's sheep meat market is mutton

MOVING ON UP: In the last five months demand out of China for mutton has been significant – up by 77pc compared to the five year average.

MOVING ON UP: In the last five months demand out of China for mutton has been significant – up by 77pc compared to the five year average.


In the wake of a season recognised for lamb prices never seen before, mutton has come out the star performer.


As Australia’s lamb supply and price responds to welcome 15 to 50 millimetre falls across parts of the eastern states, it’s mutton that has been trumping the sheep market. 

The Eastern States Trade Lamb Indicator (ESTLI) climbed three per cent to creep back above 700 cents per kilogram carcase weight (cwt) last week with saleyard prices posting gains in all reported categories apart from restocker lambs. 

But mutton’s remarkable upward trend rallied an impressive seven per cent to 411c/kg and at the time of print had bolstered up another notch to 427c/kg. That’s a 20c increase at the same time last year. 

Perhaps where mutton has really gone under the radar though is its slaughter numbers which are tracking significantly higher than normal for the season.

One of the main drivers is the resurgent demand out of China and the tough season on the ground pushing higher mutton numbers through the saleyards. 

East coast mutton throughput is running 117 per cent above the five-year average pattern for this time of the year, with elevated numbers particularly present at Victorian and NSW yards.

Mecardo analyst Matthew Dalgleish said producers that are under any stress due to pastoral and feed costs have had to weigh up their options.

“If they have had to weigh up getting rid of one or the other, they are probably leaning towards getting rid of mutton rather than selling younger sheep that they might get added value from down the track,” Mr Dalgleish said.

“The good forward prices that have been released into the new year – 750 to 800 cents a kilogram – these are signals that processors are concerned that they aren’t going to have enough supply of reasonable quality trade lambs.” 

He said considering how the slaughter prices have been tracking, the mutton prices have held up remarkably well, most probably centred around the Chinese demand absorbing the excess supply. 

In the last five months demand out of China for mutton has been significant – up by 77pc compared to the five year average. 

The monthly average of mutton going offshore (all overseas markets) is just over 14,100 tonne, which is about 30pc higher than the five year average. 

Mutton exports to China spiked in January with February through to April similar to last season. 

Yet May through to September exports were well above average, with some months three times higher compared to the same time last year. 

What is driving the demand?

According to Mr Dalgleish the mutton demand in China fell away a few years ago, with the main culprit being an over supply from their own domestic flock. 

“They pulled back on the export demand based on what was happening on the ground there in terms of their supply situation,” he said. 

“But in the subsequent few years it has began to climb again. It could be the combination of changing supply on the ground there, and the fact that New Zealand, in the last five years or so, have been reducing their breeding ewes and lamb crop taking them into declining numbers.

“That adds to the global situation in terms of what is available.”

Australia and NZ provide about 70 of what is exported around the world so according to Mr Dalgleish with NZ reducing their numbers, countries have to look elsewhere and Australia is the next best alternative. 

That, combined with the general combination of population growth and increased wealth would be flowing through as well, he said.  

The forecast from the Food and Agriculture Organisation, into the middle of 2025, shows the majority of growth in demand for sheep meat is all coming from what they classify the developing world with Africa projected to have strong growth levels. 

They have forecasted to have around 2.5pc growth to Asia each year and considering 60pc of the global exports goes into Asia, that increase, in terms of volume, is significant. 

The story The global demand for mutton first appeared on Farm Online.


From the front page

Sponsored by