Content supplied by Rabobank.
New Zealand red meat production is forecast to decline in the year ahead, Rabobank says in its newly-released 2025 Global Animal Protein Outlook, with pricing expected to improve on the back of the smaller herds.
The report, by the global agribusiness banking specialist’s RaboResearch division, says New Zealand beef production is likely to decline around 6% in 2025, although there is potential for the country’s beef cattle numbers to stabilise and possibly even rise into 2026.
New Zealand sheep numbers are declining, the report says, with 2025 production and exports impacted by a challenging 2024, which saw low farmgate prices, lower breeding ewe inventories and difficult lambing conditions in key sheep-producing regions. And as some red meat producers moved to build cattle numbers at the expense of sheep to capitalise on strong beef export returns.
The decline in New Zealand red meat production is in line with slower global production growth RaboResearch expects in the main “terrestrial” animal protein species in 2025, with volumes particularly contracting in Brazil and a much smaller increase in production growth expected in China this year.
Overall though, the report forecasts total global animal protein production to grow slightly faster than in 2024, driven by growth in aquaculture, wild-catch seafood and poultry.
Pivotal moment
Report lead author, RaboResearch senior animal proteins analyst Angus Gidley-Baird said 2025 marked a “pivotal moment” for global animal protein production across various regions and commodities.
“Overall production is set to grow slightly faster than in 2024, driven by aquaculture, wild catch and poultry,” Mr Gidley-Baird said.
“Seafood and pork are expected to transition from contraction to growth, while beef will move from growth to contraction, reshaping market dynamics and supply chains.”
Aquaculture and wild catch seafood are projected to grow by 2.3% year-on-year, rebounding from a 0.3% decline in 2024.
Poultry will continue its steady growth, while beef production will decline due to contractions in major regions.
Pork production will be up marginally (+0.1%) after significant growth from 2021 to 2023 following recovery from African swine fever, the report said.
Mr Gidley-Baird said growth in terrestrial species production will decelerate in most regions, with Brazil experiencing a 1% contraction. China will see a small increase after negative growth in 2024. Oceania will maintain steady production, while the EU-27+UK, North America and Southeast Asia will face slower growth than in 2024.
New Zealand
Throughout 2024, beef was the “moneymaker” for New Zealand red meat exports, the report says.
Beef cattle numbers in 2024 were an estimated 7% lower than the five-year average and fewer beef calves were raised over the past two years, RaboResearch New Zealand-based senior animal protein analyst Jen Corkran said. And this would constrain production potential in 2025, she said.
“Beef farmgate returns climbed to 20% above five-year averages in 2024, and pricing is on track to remain above five-year averages in 2025,” she said.
Ms Corkran said strong export demand will support a slow increase in New Zealand beef inventories in the year ahead.
“Contraction in the US beef production system has added upside to export demand and farmgate prices for manufacturing beef, which has, in turn, increased demand across all cohorts of cattle,” she said.
For sheepmeat, Ms Corkran said, the 2023/24 season had been a challenging one, with export returns down 7%, despite total export volumes being up 3%.
“Sheepmeat farmgate prices hit a cyclical low over the 2023/24 season, with farmgate returns as much as 20% below five-year averages while a strong lamb crop saw sheepmeat production volumes increase in 2024,” she said.
Ms Corkran said sheepmeat pricing had recently improved in New Zealand, currently sitting just above five-year averages, due to improved demand and higher volumes going to markets outside of China, particularly the EU, UK and US.
“Australian sheepmeat supplies for exports may continue to add competition and limit upside in pricing, but with improved demand in these markets, lamb export earnings are likely to improve from 2023/24 levels,” she said.
Global
Supply availability, along with economic conditions and geopolitics, will significantly influence global animal protein markets in 2025, the report says.
Demand and access to markets remains uncertain due to macroeconomic fluctuations and policy changes, Ms Corkran.
As the global economy strives for recovery, anticipated policy shifts from new governments could introduce protectionist measures, leading to tariffs and higher trade costs, she said.
“Military conflicts may further disrupt shipping and freight, impacting global trade and increasing market volatility. Although inflationary pressures have been easing, policy decisions could reverse this trend, potentially weakening consumer demand if incomes do not rise accordingly,” she said.
Biosecurity management – and the presence and impact of animal diseases – will remain a challenge for animal proteins sector globally in 2025, the report says.
“Although vaccines, genetics, and technologies like artificial intelligence aren’t new, the industry will increasingly turn to these solutions to better manage and control animal disease,” Ms Corkran.
Sustainability also remains a focus for animal protein supply chains, he said, with legislative action and nature-related pressures posing strategic challenges. “Companies are being encouraged to prepare for data collection as reporting guidelines evolve and to find synergies between climate, nature, and regulatory demands through emerging technologies,” she said.
12 Comments
NZ meat producers need to do their homework if they want to be successful. Actually understanding demand needs to start from the consumer in each target market. MLA in Australia has just done a comprehensive research project across ASEAN to assess the market properly. And it was done properly. Not shuffled to some public sector-connected consultant charging exorbitant fees for little return.
When I was in straya recently, an Aussie Butcher was selling chunks of Japanese Wagyu for $450.
Our meat has a decent reputation some places, but we need to develop it out into higher value niche categories. We've managed to do this with many of our other products. Our wine for instance, has been marketed as such for it to get a decent chunk more for it internationally than Aussie plonk. They make heaps more of it, but we take a greater $ per bottle.
Ayup. Aussie is often worse than even us at value add.
But this was Japanese Wagyu. Effectively marketed as the Rolls Royce of beef. The global price for a bog standard piece of old dairy cow doesn't factor into it. To use one of your terms, they've managed to make a product that's a "price taker" as opposed to one that has to succumb to competition.
Bona fid Japanese Wagyu is a combination of the breed of cow and a fairly intensive/expensive method of raising them. They are, as far as I'm aware, the only producer of Japanese Wagyu, so have a market to themselves.
Australian Wagyu is just the breed of cow, without the same degree of artisanship as the Japanese display. So much more of a commodity product, competing with anyone else's Wagyu, or other higher end beef.
The sheep meat industry has been declining steadily for over forty years. Just compare the relative flock numbers and works operating in 1985 to 2025. The development of a trade of excellent chilled lamb product helped but that just hasn’t been enough. The carcass itself is small unit processing and only about 35% of it provides suitable cuts. Have a look in the local supermarket at all the fresh & frozen primal bone in lamb legs now on offer as an indication of where things are going. It’s a shame, for it is a good product, but the export supply has now fallen to a point where it has lost both profile and presence in the market(s) and has become a harder and harder sell. Realistically any farm that may have land left suitable to conversion to dairying should take that option. At least cattle once culled have a proven market for manufacturing beef in Nth America.
Fundamentally there just not enough profit in whole chain, neither farmers or processors make any where near enough hence the decline in red meat production. While beef is experiencing a current upturn in prices sheep out look decline just continues on.
New Zealand costs of doing business are uncompetitive.
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