NZ dairy and red meat exports to China forecast to grow in next decade – report

Exports of red meat and dairy to China will continue to grow in the next decade, however, the amount will eventually taper off as the country looks to produce more of its own food.

That is according to the 2023-2032 China Agricultural Outlook Report recently released by China’s Ministry of Agricultural and Rural Affairs.

New Zealand’s Ministry of Foreign Affairs and Trade has crunched the numbers in the report which forecasts consumption and trade trends of key agricultural commodities over the next decade.

Last year China imported 18.5 million metric tonnes of dairy products and that is forecast to grow by 25 percent in the next decade.

It is increasing its own domestic dairy supply, with production forecast to grow by nearly 40 percent by 2032 – however demand is forecast to increase by nearly 35 percent – leaving room for imported product.

But MFAT said eventually the growth in production would outpace the growth in consumption.

“Dairy imports will continue to grow over the projection period but the rate of growth will decline over time.”

Production of beef and sheepmeat within China is also forecast to grow but at a slower rate of 9.2 percent and 10.2 percent respectively.

Imports of beef will lift 17.2 percent and sheepmeat imports are forecast to grow 33.3 percent in the next decade.

China will continue to eat more red meat than it can produce – so will have a continued reliance on imports.

“For imported beef, the projected increase of 17 percent amounts to 460,000 metric tonnes, which, for context, is more than double New Zealand’s total beef exports to China in the year-ending September 2023,” MFAT’s report said.

“An opportunity exists for beef exporters to China but New Zealand currently is only a small player, holding only eight percent of the market share in the very competitive imported beef market.”

China also continues to grant access to export beef, with Denmark and Poland signing agreements this year.

“While sheepmeat imports are expected to grow significantly, China already accounts for more than 57 percent of New Zealand’s total sheepmeat exports.

“Given New Zealand’s current sheepmeat production and the limited capacity to ramp up production in the short-term, New Zealand is unlikely to fill the supply gap without expanding supply,” MFAT said.

Horticulture is set to become the biggest growth opportunity due to higher household disposable income combined with consumer preference for premium imported fruit.

China’s imports of fruit are forecast to grow by 92 percent over the next decade, however, the report does not break that down into different fruit varieties.