skip to content1
Just a heads up, our Online and Mobile Banking will be offline for scheduled maintenance between 12:00 am to 8:00 am on Sunday, 10th of December 2023.
We apologise for any inconvenience.

It is important that you take steps to protect yourself from cyber criminals. Please visit for more information on how to protect yourself online.

Strong global beef demand but plentiful challenges – Rabobank industry report

Constrained global beef availability and ongoing strong demand continue to support elevated prices for New Zealand beef farmers, however a raft of processing challenges have placed the industry in a race against time to capitalise on the strong returns, Rabobank says in a newly-released report.

In its Q1 Beef Quarterly, the agribusiness banking specialist says New Zealand’s meat processors are now juggling a host of issues including significant staff shortages, the risk of Covid-19 and its impact on plant operations and the ongoing headache of container availability.

“With the processing season now reaching its peak and many plants currently short-staffed, there are now wait times of several weeks to get prime beef slaughtered across both the North and South Islands,” RaboResearch agricultural analyst Genevieve Steven said.

“These worker shortages are only expected to get worse over coming weeks as Covid-19 continues to spread across the country, and this all comes at a time when the sector is grappling with reduced container availability that is limiting the sector’s ability to ship product to overseas markets.

Genevieve Steven - Sheep and Beef Research Analyst
Rabobank agricultural analyst Genevieve Steven

“Weekly schedule prices are expected to remain above the five-year average, but we do anticipate they’ll follow usual seasonal pricing trends which generally move lower as we progress further into the season. As a result, farmers will be hoping further processing delays can be minimised and they can continue to capitalise on the strong beef schedule.”

The report says New Zealand beef production for quarter four last year was down four per cent year-on-year, largely driven by a reduced cow and bull kill in the South Island.

“Unfavourable spring conditions reduced grass growth and slowed the rate of weight gain of bulls. A record milk price and adequate feed conditions have also incentivised farmers to retain dairy cows,” Ms Steven said.

New Zealand beef recorded healthy export earnings in quarter four, the report says, despite a 10 per cent reduction in volume exported.

“New Zealand beef exports lifted 22 per cent in value in Q4 last year with increased sales into Asia the key driver of the lift. Shipping routes to Asia are less congested and demand from Asian markets remains strong,” Ms Steven said.

The report says La Niña has caused unusual summer rain patterns over recent months.

“Recent heavy rain has topped up the soil moisture profile across the entire country, setting farms up well for a successful autumn, and giving farmers options if they need to hold stock longer due to processor delays,” Ms Steven said.

Global update

As with New Zealand, the report says, key beef markets around the world remain strong, however headwinds are building.

Ms Steven said one of the main potential headwinds for the global beef sector is how consumers respond to high retail beef prices.

“Over the past two years, retail beef price movements have been phenomenal, driven largely by strong consumer demand and some supply shocks. In large consuming countries such as China and the US, we have seen retail prices jump substantially and in many cases, this increase in prices was caused by demand pull,” she said.

“Consumers with lockdown restrictions imposed, additional disposable incomes or limitations on alternative protein availability – in the case of China and African Swine Fever – have caused demand for beef to increase. With supply unable to keep up, the increase in demand has created an imbalance in the market and, as a result beef prices have lifted.

“While the price rises have been dramatic, the fact that increased consumer demand has largely been the cause of the rise has meant that the increases have been accommodated. That is, consumers have been willing to pay higher prices to continue consuming beef. But with several macroeconomic factors currently pressuring consumer confidence, it remains to be seen whether global consumer tolerance for high beef prices will continue.”

The report says rising supply chain costs are a further headwind for global beef producers.

“Global beef producers have been hit by significant cost increases for labour, freight and energy and, while wage growth has not necessarily seen increases across all countries yet, the added costs of employment, resulting from reduced staff availability due to Covid infections or increased costs to protect employees, is adding to overall labour costs,” Ms Steven said.

“Feed costs have also increased and there’s potential for more upward movement because of the Russia Ukraine conflict. The two countries account for 29 per cent of global wheat exports, so any trade embargoes could further pressure feed prices.”

The report says beef production in key producing countries is expected to lift slightly in quarter one 2022 before stabilising in Q2.

“Australia is recovering from drought and is expected to show the largest production gain in the first quarter while a small increase is also anticipated in Brazil’s production during this period,” Ms Steven said.

“Beef production in the US — which is entering a contraction mode — is expected to be steady in Q1, and small volume contractions are anticipated in China and Europe.”

Rabobank New Zealand is a part of the global Rabobank Group, the world’s leading specialist in food and agribusiness banking. Rabobank has more than 120 years’ experience providing customised banking and finance solutions to businesses involved in all aspects of food and agribusiness. Rabobank is structured as a cooperative and operates in 40 countries, servicing the needs of about 10 million clients worldwide through a network of close to 1000 offices and branches. Rabobank New Zealand is one of the country's leading agricultural lenders and a significant provider of business and corporate banking and financial services to the New Zealand food and agribusiness sector. The bank has 32 offices throughout New Zealand.

Media contacts:

David Johnston
Marketing & Media Relations Manager
Rabobank New Zealand
Phone: 04 819 2711 or 027 477 8153

Denise Shaw
Head of Media Relations 
Rabobank Australia & New Zealand 
Phone: +612 8115 2744 or +61 2 439 603 525