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MLA Market Snapshot reports released
08 February 2023
MLA has released a suite of 2021–2022 Market Snapshot reports covering 13 key global markets (including Australia) for beef and sheepmeat.
The snapshots provide the most recent insights into consumers, retail and foodservice sectors, and our trading environment, including export data and competitive landscape.
Visit Overseas Market Data and Insights to view the snapshots.
Key insights
Summary
- Australian beef exports fell 4.9% year-on-year in 2021–22 to 863,746 tonnes shipped weight (swt). Besides the tight supply from Australia, other key influencing factors include logistical and labour challenges, higher cost of living and increased exports from key competitors such as the United States of America (US) and Brazil. Top export destinations by volume in 2021–22 were Japan, Korea, China, the US and Indonesia.
- By contrast, Australian sheepmeat exports performed strongly in 2021–22 with total export volume up 4.3% year-on-year (to 413,426 tonnes swt). While inflation and supply chain challenges were also applicable to sheepmeat trade, increased product availability from Australia and strong demand from key and emerging markets such as the US, Canada, Papua New Guinea, Korea, Japan, the Middle East and Southeast Asia (Malaysia, Singapore and Indonesia) drove this growth.
Consumers and red meat consumption
- Australian beef and lamb are globally regarded as high quality, trustworthy, natural, safe and ‘better for me’. Beef is generally considered a superior protein with high nutritional values making it a family favourite. Sheepmeat is often a niche protein enjoyed on special occasions for most consumers while being more popular among Islamic consumers worldwide, with consumption spikes occurring during religious festivals and celebrations.
- Despite the global challenges in the post-COVID environment, we saw growth in beef consumption from emerging markets such as Mainland China, Southeast Asia and the Middle East, driven by rising incomes and expanding urban populations. Collectively, total beef consumption in these regions is estimated to grow by 3% year-on-year in 2022, faster than established markets (Australia, US, EU) of 1%.
- More consumers are paying attention to maintaining a healthier and more balanced diet. In the USA, "64% of US shoppers are focused on choosing ‘better for me/my family’, nutritious and healthy meat/poultry (Source: Power of Meat 2022)"; in Japan, 7 in 10 consumers say they have become more conscious of their health due to the pandemic and have started to pay more attention to diet and nutrition (Source: Akita Food's Survey on Health Awareness during the pandemic in 2021 October). This presents further opportunities to increase consumer awareness and preference for Australian red meat.
- Consumer demand for convenience remains solid, underpinned by busy lifestyles and enabled by ever-evolving technologies. An expanding range of convenience offerings are entering markets, from traditional ready-to-eat and ready-to-cook packaged products to innovative food-on-the-go, meat snacks and meal kits. For example, the meal kit segment in Korea is growing rapidly, with sales estimated to have tripled during COVID-19 to approximately $400 million Australian dollars in 2022 and forecast to be double this by 2025 (Source: Euromonitor/Seoul Economic News). Australia has also seen a rapid expansion of the food box meal kit sector (such as Hello Fresh and Marley Spoon). Although small, this segment has grown 57.8% in value over the last two years. With 14.8% of Australian households having purchased the product, it now represents 1% of Australia’s total grocery value (Source: NielsenIQ Homescan MAT to August 2022).
- Rising cost of living has made consumers more value conscious. Shoppers are increasingly prioritising their spending on items and experiences that offer better value to meet constrained budgets. Some 6 in 10 shoppers across almost 40 countries surveyed say that the greatest influence on their purchase decision-making is how well the product aligns with their time and money constraints, second highest after health considerations (Source: GlobalData Global Consumer Survey Q4 2022).
Retail
- Grocery retail sales fell in 2021–22 compared to the previous year as more restaurants resumed business post-pandemic. However, retail sales remain a solid channel for red meat purchasing, with increased home cooking one way to manage growing cost of living pressures.
- We see more differentiation in retail products – not just beef, or lamb, or Australian. For example, US retail is seeing a greater presence of grass-fed, organic and wagyu products, meeting diverse needs of consumers. In Korea, there is a wider range of cuts beyond traditionally popular cuts such as chuck roll, brisket and blade. Western-style steaks, even tomahawk, as well as items for barbecuing such as burger patties, have gained traction.
- Albeit from a small base, online sales of red meat are increasing and are expected to be among the fast-growing channels in coming years. Korea’s online sales of fresh meat, fish and other seafood have doubled since COVID-19, with a transaction value of around A$8.5 billion in 2022 (Source: Statistics Korea, Jan-Nov 2022).
- Total online grocery is expected to be the largest and fastest-growing channel in Korean retail. China, US, UK, Japan and Korea were the world’s top five largest online-grocery markets in 2022, while Southeast Asia will be among the fastest-growing over the next several years (Source: IGD).
- Driven by emerging markets, sheepmeat consumption growth remained strong in 2022. Despite being a less frequently consumed protein in everyday meals for most consumers, growing consumer interest in enjoyment and ‘trying something different’ has been one of the major drivers for sheepmeat demand growth. This has been accelerated by COVID-19 as consumers cook more at home. Korea, for example, is one of the fastest-growing high value markets for Australian lamb exports and is now Australia’s third largest, by value, after the US and China.
Foodservice
- Australian beef is typically used in higher-end restaurants across global markets (except in the US, Japan, and Korea where local beef has stronger penetration), while Australian lamb and mutton are utilised across a broader range of foodservice segments. With the ongoing COVID-19 impacts on tourism and inflationary pressures, the premium foodservice segment faces a slow recovery compared to fast food and lower-end. Hence, demand for Australian red meat is yet to reach pre-pandemic levels. However, in markets where Australia has high penetration in the fast-food sector, such as Japan, steady growth in 2022 was supported by fast recovery in delivery and takeaway services. Manufacturing beef exports, which has strong penetration across Japanese fast-food chains, increased 5.8% year-on-year after a temporary drop in 2021 due to COVID-19 restrictions.
- Across all markets, there is a growing interest in trying different, non-local cuisines. This trend, along with booming domestic and inter-regional tourism, has increased opportunities for menu innovation with both beef and lamb.
- While demand for Australian red meat in foodservice remains subdued due to ongoing recovery in the higher end foodservice sector and in-bound tourism, as well as inflationary pressures, new demand has been stimulated by innovative efforts by higher-end foodservice operators such as home delivery of meal kits (‘five-star at-home dining, for example) or more affordable fine-dining offerings.
Market spotlight
- The United Kingdom (UK): Britons have a positive pre-disposition to Australian red meat, despite a still-limited presence in the market due to market access constraints. Industry is looking forward to the Australia-UK Free Trade Agreement entering into force in 2023, with enhanced market access enabling the exploration and development of new opportunities for Australian red meat in the UK.
- Thailand: Despite the profound impacts of COVID-19 on foodservice and tourism, Australian beef exports to Thailand have grown rapidly since the removal of import tariffs in 2020. Total volume exports to Thailand in 2021–22, double that of 2018–19, reached around 12,551 tonnes/swt. The country takes a wide range of Australian products, including premium grainfed which has seen volume also almost double to around 2,023 tonnes. Thai consumer demand for beef has risen with the popularity of Japanese, Korean and western-style cuisine, with supply facilitated by the favourable tariff regime under the Association of Southeast Asian Nations (ASEAN)-Australia-New Zealand free trade agreement.
