UK free trade aggrements delivers 50% price premium for Australian beef

The United Kingdom is paying a 50 per cent premium for Australian beef compared to the average Australian export customer — for a very small cut.

The United Kingdom is paying a 50 per cent premium for Australian beef compared to the average Australian export customer - for a very small cut.

While the volume the UK imports is small, it’s the first step in what analysts say could become an increasingly valuable market for Aussie beef.

Figures from Meat and Livestock Australia show the UK is paying $14.81/kg, compared to the average for Australian beef exports of $9.86/kg, according to the most recent figures available from May.

Year-to-date figures show just 3434 tonnes of Australian beef were imported by the United Kingdom in the first seven months of the year.

The European Union, and Ireland in particular, are the major suppliers of beef to the UK, with 102,205 tonnes annually.

On the lamb front, exports are also up, with 7928 tonnes of lamb going into the UK from January to July, making it Australia’s eighth biggest destination.

It’s more than a year since a free trade agreement was signed between the UK and Australia, and with it, the capacity to send 35,000 tonnes of beef and 25,000 tonnes of lamb each year, tariff free.

MLA global analyst Tim Jackson said the trade deal was starting to pay off.

“The FTA between Australia and the UK has given Australian exporters access to a high-value market that provides considerable opportunity over time,” Mr Jackson said.

“In the year to the end of July, beef exports to the UK are up 252 per cent from 2023, and lamb exports are up 75 per cent.”

Mr Jackson said it was important to note that major market growth often did not happen overnight.

“When you look at Japan, that beef market probably took 30 years to get to its peak,” he said.

Australian Meat Industry Council chief executive officer Patrick Hutchinson said “all markets are important and all have their own opportunities and challenges”.

“The removal of tariffs and highly restrictive volume quotas through the UK FTA has allowed market forces to play out uninhibited, and as a result, Australian meat exporters are taking a serious, long-term approach to the market while maintaining their relationships and trade to over 100 markets around the world,” Mr Hutchinson said.

“Australia was always clear with the UK that we do not have the capacity or intent to ‘flood’ the UK market.”

Mr Hutchinson said the measured approach by Australian meat processors and exporters to UK trade showed they were taking the market seriously and with a long-term view.

“With current record Australian exports to the world, and a finite amount of sheep meat, beef and goat meat available to be produced, AMIC expects Australian meat processors and exporters to grow relationships in such a way as to provide safe, quality and sustainably produced meat that meets UK customers and consumers demand while continuing to supply our longstanding customers in other markets around the world.” he said.