The Sheep is Back – New Markets Hold Key to Future Growth
Rabobank expects demand for Australian sheep products to remain strong for the next five years. To sustain the value lift seen for sheep products in recent years, producers need to look at segments of the market such as millennials that are looking for quality, authenticity, and transparency and are, in some cases, willing to pay more for it.
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Global consumption of sheepmeat is expected to increase at a 1.6 percent CAGR over the next five years with prospects for value growth in new markets. There will be limited volume growth in wool consumption as supply remains under pressure from the current dry conditions, but Rabobank believes that continued demand from both traditional markets and new consumers will help sustain the value growth for wool seen since 2015. “Wool and lamb are well placed to leverage existing characteristics and target new consumers,” according to Angus Gidley Baird, RaboResearch Senior Analyst – Animal Protein.
“Australian sheep producers are already well placed to capitalise on these new markets as they have a good reputation for quality,” says Gidley-Baird. “However, there will be strong competition from alternative fibres and proteins for these same markets and producers will need to continue to look for improvements in the areas of transparency, quality, and flexibility.”
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