A credible threat?
- The USA are a key destination for Australian lamb and mutton exports accounting for around 26% of our lamb exports and 14% of our mutton exports.
- The UK holds third position in export volume market share at around 7% of the global trade.
- Over the last five years the UK have imported about 85% of the sheep meat volumes they have exported.
Last week Boris Johnson announced that the USA would lift its 32 year old ban on sheep meat exports from the UK. The USA are a key destination for Australian lamb and mutton exports accounting for around 26% of our lamb exports and 14% of our mutton exports. In 2020 Australian sheep meat exports to the USA alone totalled 78,584 tonnes swt, a figure which rivals the UK’s total export programme each year.
Analysis of the proportion of the global sheep meat trade shows that Australia and NZ dominate the export market share, with the UK holding third position in export volumes at around 7% of the share of trade. In 2020 the UK produced about 300,000 tonnes of sheepmeat and exported 88,000 tonnes.
The UK are the fifth largest producer of sheepmeat globally and are the third largest sheepmeat exporter, so having them competing with us in the USA can’t be a good thing. However, there is one factor that needs to be taken into account – the UK’s appetite for imported sheep meat product.
Annual trade flow data highlights that for much of the early 2000s the UK imported more sheep meat than they exported. Sheep meat imports into the UK have been in decline since 2009, dropping from 116,000 tonnes to just under 60,000 tonnes in 2020. In contrast, over the last decade UK sheep meat exports have ranged between 80,000 to 100,000 tonnes.
Over the last five years the UK have imported about 85% of the volumes they exported. In 2019 the import to export ratio in the UK was the lowest it has been on record, yet still managed a healthy 64%. In 2020 the import ratio increased to 68%.
A focus on lifting sheep meat exports from the UK into markets like the USA will either reduce the UK export volumes to their other key trading partners, such as France, Germany and Ireland. Or, it will mean there is less product available for domestic consumption lifting the sheep meat import volumes into the UK. Either way, this will provide opportunities for dominant global sheep meat exporting nations like Australia and New Zealand.