Sheep meat prices at the farm gate are not looking particularly pretty at the moment.
Andrew Burtt, Chief Economist at Beef + Lamb New Zealand, joins Dom George to discuss various factors contributing to the unpredictability of meat prices, particularly in the sheep sector. The conversation delves into the intricacies of the sheep meat market, which is currently experiencing a downturn in prices.
This decline contradicts expectations that the Chinese market would experience a surge in demand following the lifting of COVID-19 lockdowns.
"China's not performed the way we thought it would and we—being a whole lot of people, a whole lot of meat industry analysts," Burtt explains.
The conversation touches upon global issues like the COVID-19 pandemic's enduring effects, geopolitical tensions, high energy costs, and the impacts of the Russia-Ukraine conflict. Moreover, diseases such as African swine fever and avian influenza are mentioned as reshaping factors for trade currents.
Despite these challenges, Burtt points to the resilience of the U.S. beef market, which has been buoyed by drought-induced herd culling, showing the complex balance of global agricultural markets. The conversation provides a platform for farmers' unique challenges and the importance of recognizing each farm's distinct situation without prescribing one-size-fits-all solutions. Burtt remains hopeful, suggesting signs of financial rejuvenation for farmers.
"Each of them has a unique set of circumstances and considerations that they have to take into account for their own businesses," Burtt states, acknowledging the diverse experiences of farmers.
His assessment of the market's volatility highlights cost inflation on farms, a problem that has developed over the past few years.
"This year, this season, on-farm inflation will be about 5%... it adds up to 35% over the last three years, which is very, very high."
The conversation underscores the volatility of the agriculture sector and the importance of strategic resilience among farmers.
Listen to the full chat between Andrew Burtt and Dominic George above.
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