NZ Beef Mince Now Over $24/kg as Export Demand Stays Strong
New Zealand consumers are paying more for beef mince than ever before, with the average retail price now sitting above $24 per kilogram, according to Rabobank.
This could translate into higher prices for New Zealand beef exporters.
The bank's latest Global Beef Quarterly report, 'Navigating Declining Global Production', released last month, says Brazil and the US are likely to lead beef production declines in 2025.
"Reductions in China, Europe, and New Zealand are also likely, and Australia may be the only top-10 beef-producing country to post year-over-year production gains in 2025," it says.
While North American cattle prices have been high for close to two years because of the lower cattle numbers and strong consumer demand, the report says, some other countries have experienced low cattle prices.
"This trend has started to change as global beef supply declines start to firm up support for cattle prices in South America, Australia and New Zealand."
With available supplies altered across the top global beef markets, the report says, beef trade is expected to shift dramatically.
"We anticipate Australian beef producers will increasingly depend on exports to absorb stronger domestic production, while Brazil will see global markets as a better demand opportunity compared to lacklustre domestic demand," the report says.
It cautions that global beef production has the potential to swing dramatically if weather patterns change.
"US producers are waiting on more dependable precipitation to rebuild the herd, and Brazilian production is being slowed by rain delaying the supply of cattle fattened on pasture," it says.
"Australia has maintained relatively adequate precipitation for a few years, but the threat of dryness could lead to more production."
RaboResearch senior agricultural analyst Jen Corkran says the optimistic outlook for beef in New Zealand could encourage producers to build cattle numbers, leading to a production increase in coming years.
"2024 has seen a 3.7% drop in bobby calf numbers, indicating more dairy beef may be being reared to enter the beef herd," says Corkran.
Total export volumes for New Zealand beef were down 19% year-on-year for quarter three 2024, while average export values were up by 9% year-on-year across the same period.
Corkran says the overall increase in export value had largely been driven by strong volumes and value for beef exported to the US.
"US beef export values were up by 19% year-on-year for quarter three, averaging $10.56/kg, which is rright up there with some of the best export value we've seen for New Zealand beef to the US market.
"However, this was partially offset by lower export values to China, which decreased by 5% year-on-year for quarter three to $6.87kg.
"Farmgate pricing across all cohorts of beef cattle was 15% to 19% above five-year averages over quarter three, 2024, and this has helped cement beef as the golden goose of red meat exports for New Zealand."
Looking at the full 2023/24 export season (October 1, 2023 to September 30, 2024) US exports have dominated.
Total US export volumes were up by 9% year-on-year to 181,000 metric tonnes (t), while China volumes dropped by 22% year-on-year to 159,000t.
Corkran says strong volume increases were recorded in secondary markets, with Japan and Canada increasing volumes by 46% and 50% year-on-year to 35,000t and 24,400t respectively.
