China’s need for protein triumphs over trade tension, as nation’s sheep flock reverses decades of decline

Exports to the Middle Kingdom are at near-record levels, helping to reverse a 30-year decline in the nation’s sheep flock.

Tasmanian sheep farmer Louisa Street checks a shipment of fat, healthy lambs at her Cressy property before they are collected for foreign export. Picture: Amy Brown

China’s need for protein has triumphed over initial threats to Australia’s lamb trade, with exports to the Middle Kingdom at near-record levels, helping to reverse a 30-year decline in the nation’s sheep flock.

The second highest ever volume of sheep meat exports to China is expected in 2020-21, with producers forecasting volumes just shy of the record 150,000 tonnes – $1.3bn worth – set in 2019-20.

An ongoing boom in exports comes despite Beijing temporarily banning imports from two of the nation’s largest exporters when they were hit by Covid outbreaks in 2020.

“There were a couple of hiccups in relation to re-accreditation of plants around Covid, but all in all the exports have continued in a normal, low-key way,” said Stephen Crisp, chief executive of Sheep Producers Australia.

“It’s the second biggest year (for exports to China) we’ve had. So we’ve got no issue with China.”

Demand has also been strong in Australia’s other major lamb market, the US. “The US supermarket demand picked up 20 per cent but China is still very, very important and it’s still a very big number,” Mr Crisp said.

Sheep meat exports to China for 2020-21 were expected to be between the second highest record of 136,000 tonnes of 2018-19 and the record 150,000 tonnes of 2019-20. Asian swine fever appears to partly explain China’s ongoing interest. The disease has decimated pork supplies, forcing wealthier Chinese to consider new sources of protein.

The strong export demand is seeing farmers nationally switch focus from fine wool production and crops to sheep for meat.

Tasmanian Northern Midlands farmers Louisa Street and Charles Dowling have almost doubled the size of their sheep flock in the past three years, and are placing a 2300 tonne grain program on hold to focus on lamb.

About 60 per cent of 4000 lambs they produce this year will go for export. “We’ve decided this year that we’ll focus more on the red meat because that looks like it will be more profitable,” Ms Street said. “We’re still increasing our numbers of sheep, with export our main market. I think it’s only going to grow.”

The US and Chinese interest in lamb is helping to reverse a 30-year decline in the nation’s sheep flock. “There is a recovery in sheep numbers all over Australia,” Mr Crisp said. “We’re expecting 68 million sheep within a year. At the moment the flock is about 64 million. So we are having a bounce, with seasonal conditions having a lot to do with that.”

With improvements also expected for wool, Australia – whose economy once “rode on the sheep’s back” – appeared to be turning the tide on multi-decadal decline.

“The Australian sheep flock has been in decline since about 1990, when there were about 180 million sheep, so it’s been a massive decline,” Mr Crisp said.

“So it’s good to see the trend reversal. Sheep are part of some of the most profitable (farming) properties in the world at the moment, so hopefully we’ll see that trend continue.”

Mr Crisp said the new Free Trade Agreement with the UK would further open up the British market, while existing access to up to 90 other countries meant the trade had options should one market decline.