After entering a 2014/15 production season with quite positive pricing forecasts, New Zealand farm gate lamb prices softened significantly over the course of the season. This has naturally become a source of frustration among many producers and led toconsideration of the structure of the industry, both domestically and how it operates in off-shore markets.The reasons behind weak prices and questions around optimal industry structure are both complex - and there is rarely, if ever, only one factor at play. The current lamb price situation in NZ is a good illustration of this. In recent years China has grown to become our single biggest lamb export market by volume, a trend that showed every sign of continuing. However, in the current season lamb, exports to China have unexpectedly fallen by 12%. This decrease has been attributed to an increase in Chinesedomestic production, but with the Chinese economy slowing and production statistics being unreliable there may be other factors involved.
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