Falling sheep numbers offset by high productivity

17 December 2003

Falling sheep numbers offset by higher productivity

Sheep numbers are expected to continue to fall but productivity per animal is expected to continue to rise over the next three years, according to the latest MAF Situation and Outlook for New Zealand Agriculture and Forestry (SONZAF) report.

The 2003 SONZAF report says the downward trend in the size of the country's breeding flock is likely to continue as more land is converted into deer, forestry and dairy cattle production.

However, the report says sheep meat production will be sustained by increasing productivity in terms of lambs tailed per ewe and rising lamb carcass weights.

It says that over the next year, to September 2004, inspected lamb production is expected to fall to 408,000 tonnes carcass weight (cw). This reflects poorer mating conditions in autumn 2003 and localised adverse lambing conditions in spring 2003.

However by the year ending September 2007 both lamb and mutton production will increase.

The SONZAF report says this reflects rising productivity in terms of lambs born per ewe, hogget mating and lamb carcass weights, partially offset by a continuing fall in the sheep breeding flock.

Exports of lamb during this time mirror production trends, and out to 2007 also reflect the rising productivity from a declining national sheep flock.

For the year ended September 2003 the mean London wholesale price for PM grade lamb carcasses were at an historic high of 215-pence per kg. That's up four percent on the previous year.

However supply was limited by lower UK production in the wake of the 2001 foot and mouth outbreak and prohibitive above-quota tariffs on product from non-EU exporters, including New Zealand.

Prices are expected to fall in the year ending September 2004 as UK sheep meat production continues to recover in the aftermath of the FMD outbreak.

The upward trend in the export of higher value chilled products is expected to continue as they compete effectively with fresh domestic lamb products.

In the longer term, the sheep industry will continue to benefit from the increasing meat consumption in developing countries.

However the bulk of New Zealand's lamb and mutton exports will remain in the higher value markets of the developed countries and in particular the EU and US.

Ends