First-cross ewes reach new heights while global outlook varied

Another national record was broken for first-cross ewes online last week while global uncertainty is continuing to impact the retail market.

A line of 171 scanned-in-lamb first-cross ewes sold for $476 a head in Auctions Plus’ national sheep sale last week, beating the previous record set in May when a Deniliquin, NSW, producer sold 81 first-cross ewes for $446.

Last week’s 13-14 month-old ewes, which weighed 82 kilograms, were sold by Rob, Steph, James and Anna Mumford from Koolywurtie, SA.

They were of Glencorrie blood, were mated to Dorset rams and were headed to Bordertown, SA.

The ewes were sold as part of an online yarding of 73,068 sheep, which saw clearance drop from the previous week by 5 per cent to 69pc.

This new national record comes as foodservice sales across the globe remain below average as fears of further COVID-19 spikes create uncertainty in the market.

That’s according to Meat & Livestock Australia international markets general manager Andrew Cox, who said there were positives to take out of the situation and how well-placed Australia’s red meat industry was.

“It is easy to assume consumer demand will fall as people look to feed their households more economically; certainly, like any discretionary purchase, we are not entirely recession proof, but there is some cause for optimism,” Mr Cox said.

“Firstly, food demand tends to be less impacted during a recession than other less vital goods and services; people still need to eat.

“Thankfully, the diversity we have in markets and different cuts and specifications we can offer global customers means we are not exposed to any one sector of the market.”

He said learnings from the past downturn in 2008/9 indicated that whilst many people ‘traded down’ to less expensive cuts of lamb and beef, total expenditure might even increase.

“For example, fresh meat sales in the US bucked the downward trend during the Global Financial Crisis (GFC) in 2009, increasing by 4pc,” he said.

He said even products at the premium end should not necessarily expect a drop in demand.

“There is strong evidence that as consumers forgo large discretionary purchases – television sets, overseas holidays, new cars – cheaper luxuries such as a trip to the cinema or a premium cut of meat benefit,” he said.

“During the GFC, Australian consumers actually increased their purchase of lamb, an item thought to be more of a discretionary choice than a staple such as beef, and therefore more exposed to economic downturn.”

Mr Cox said underlying consumer preferences should not change during a recession, and any lost demand would increase as the economy recovered.

“One lesson from previous recessions is that brands must continue to actively invest in promotion to avoid coming out of the downturn in an inferior position,” he said.

“Research after the GFC of 2009 showed brands that went dark significantly underperformed those who continued their investment.

“And powerful brands tended to recover much faster than average.”

He said the good news for the Australian industry was that its red meat was considered a power brand.

“MLA’s research into consumer perceptions shows that in key markets our brand power is extremely strong in the meat category relative to competitors,” he said.

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