Lamb prices push up export values, despite drop in numbers

Lower lamb numbers during the first half of the meat export season have been offset by an increase in average value, which has seen the total value of exports rise by 11%.

Beef and Lamb New Zealand has released lamb, mutton and beef export statistics for the first six months of the season, from October 1 to March 31.

Total lamb exports decreased by 2.5% compared with the corresponding period last year, which reflected a smaller lamb crop.

But the decrease in volume, to 158,200 tonnes shipped weight, was offset by a 14% increase in average value, resulting in the total value of exports increasing by 11% to $1.3 billion free-on-board (FOB).

The European Union remained the largest market region, accounting for 42% of New Zealand's lamb exports by volume and worth $675 million FOB.

North Asia accounted for 33% by volume and was worth $311 million FOB. However, the EU's market share was on a downward trend while North Asia was trending upward.

Total returns achieved from North Asia averaged $6000 FOB per tonne, compared with $10,200 FOB per tonne from the EU, reflecting the different product mixes exported to the two regions.

Mutton exports increased by 26% during the six-month period, reaching a record high of 61,700 tonnes shipped weight and reflecting an early processing season.

It was expected they would drop in the second half of the season, resulting in a year-end total lower than last season.

The total value increased by 44% to $330 million FOB.

Total exports of beef and veal were almost unchanged, down only 0.4% on the same period in 2012-13 at 189,600 tonnes shipped weight, while the total value increased slightly to $1.1 billion FOB.

Rabobank's latest agribusiness monthly said the South Island lamb price was 20% higher at the first week of April than the corresponding week last year, averaging 519c/kg carcass weight.

Lamb slaughter during April, at 2.95 million head, jumped 4% year-on-year although slaughter volumes for processing were back 3% or 300,000 head year-to-date.

In a commentary on the red meat industry this week, Federated Farmers chief executive Conor English said until meat farmers produced or invested more per hectare, or meat companies were able to extract far more significant returns from the marketplace, the relative gross income gap between meat and dairy farmers would likely continue.

Some great progress had been made by both farmers and meat companies ''however we need to keep at it'', Mr English said.