The UK-Australia FTA begins to pay dividends

The UK-Australia Free Trade Agreement was announced with much fanfare, but some commodities are faring better than others. See the comparisons here.

Sheep meat exports to the United Kingdom have hit their highest level in more than 15 years as the UK-Australia Free Trade Agreement starts to pay dividends.

And while the numbers are still low in comparison to Australia’s other major export destinations, the lift is welcome news to producers hoping red meat will find more homes.

Meat and Livestock Australia global supply analyst Tim Jackson said export volumes to the UK had risen since the FTA came into effect at the end of May.

“For the UK, beef exports between May-October 2023 were 1656 tonnes, up 280 per cent on 2022 figures and the highest volume since 2019,” Mr Jackson said.

But he put the rise into perspective, it was coming off a low base.

“That said, it’s not a massive volume – monthly export volumes seem to be hovering around 300-315 tonnes per month.”

The news is slightly more promising for sheep meat, and in particular, lamb.

“In terms of lamb and mutton, since the FTA came into effect, lamb exports were 5189 tonnes, which are up 117 per cent year-on-year and the highest since 2007,” Mr Jackson said.

“Mutton exports are up 151 per cent year-on-year to 2132 tonnes and are the highest since 2017.”

Mr Jackson said this meant total sheep meat exports were up 126 per cent year-on-year to make them the highest since 2007.

Beef export numbers are up 280 per cent on 2022 figures. Photo: Lachie Millard

The UK-FTA came into effect at the end of May, and immediately gave Australia access to 35,000 tonnes of tariff-free beef into the UK market, a volume it will not meet this year.

It was a major lift from the less than 4000 tonne tariff-free quota Australia held before.

When the trade is fully liberalised in 2038, the tariff-free quota will be 110,000 tonnes with a gradual transition to this final amount.

After 10 years, there will be no tariff but a “volume safeguard provision” will apply for the following five years.

Meanwhile, red meat export figures for October hit a four-year high, up 5 per cent from a month earlier and 39 per cent more than the same time last year.

Beef exports were up 44 per cent year-on-year to 105,131 tonnes, which was the highest monthly total since 2019.

October lamb exports – at 30,604 tonnes – were also up 17 per cent year-on-year while there was a huge lift in mutton exported to 20,197 tonnes, with combined sheep meat sales the highest on record.

The United States and Canada, grouped together as North America, was Australia’s biggest customer for lamb (7142 tonnes) while China took 10,195 tonnes of mutton.