Australian lamb and mutton exports surged last month, with lamb increasing 45% year-on-year to 15,200 tonnes and mutton up 79% on the previous January to 12,800 tonnes.
In January, there were also record beef exports from Australia (55,147 tonnes) as a result of increased supply from sustained dry conditions, the latest Rabobank agribusiness monthly for February showed.
In New Zealand, total sheep meat exports for December increased 51% on the previous December to 35,157 tonnes, driven by record export volumes to China, which increased threefold to 11,053 tonnes.
However, reflecting the weak state of the major export markets, overall returns ($234 million) increased 4% year-on-year with the average export value in December settling at $6.66kg freight on boat (FOB) - the lowest average return per kg since September 2008.
Lamb prices have continued to ease since the beginning of December, underpinned by dry conditions and tightening feed supply, as well as sluggish returns from export markets.
North Island lamb prices averaged 464c/kg at the start of February, 33% lower than a year earlier, while South Island lamb prices fell 29%, averaging 466c/kg.
December wool exports were 25% larger year-on-year at 8300 tonnes, bringing the cumulative seasonal total to 57,500 tonnes (clean), a 17.4% increase year-on-year.
The value of all wool exports for the 2012-13 season declined 15% year-on-year, driven by lower fine and coarse crossbred wool export prices.
Average export values during December for venison hit a five-year low, with returns settling at $10.31 kg FOB.
New Zealand beef exports during December increased 17% year-on-year and remained relatively steady on the five-year December average, at 32,831 tonnes.
Underpinning the growth was an increase in shipments to the US (15,757 tonnes), which jumped 29% on the previous December, with ongoing tight US domestic supplies supporting demand for New Zealand product.
New Zealand milk production was around 5% higher this season to date but dry weather was taking its toll in the North Island, with production now falling significantly.
Milk flows were expected to start falling behind the previous year on a monthly basis from February onwards.
The detection of dicyandiamide (DCD) in New Zealand dairy products had created headlines globally. While not a health risk, the uncertainty for consumers and the need for testing regimes and regulations worldwide would take some time to address, the report said.
The BNZ's latest Rural Wrap said many parts of the North Island were still dealing with dry conditions and it was hurting pastoral farming in particular.