skip to content1
Just a heads up, our public website ( will be offline for scheduled maintenance between Midnight and 8:00am on Sunday, 21st April 2024. We apologise for any inconvenience.

Annual Withholding Tax Certificates for Rabobank Online Savings customers are now available.

Invoice scams are increasing. When receiving invoices, verify any new account numbers with the recipient over the phone using their publicly listed number, before making any payment. Please see our security page for more information.

Chinese demand for beef set to remain firm, outlook for sheepmeat less rosy

Despite ongoing lockdowns and slower Chinese economic growth, China’s demand for beef is expected to remain strong throughout the remainder of the year, however the outlook for sheepmeat is far less upbeat, according to a new podcast by agribusiness banking specialist Rabobank.

Speaking on the recently released podcast Is the Chinese meat market still firing?, Hong Kong-based RaboResearch senior analyst Chenjun Pan said China’s ongoing zero-Covid approach is having a substantial impact on how Chinese consumers purchase and consume food.

“While we no longer have whole cities under lockdown like we did in the first half of the year, we are still seeing districts being placed into lockdown when cases are found,” she said.

“As a result, people don’t want to take risks or to travel as far from home as they might have in the past, and this has had a big impact on how and where people consume food with banquets and business events much less frequent and many food service outlets closing.

Rabobank agricultural analyst, Genevieve Steven

Rabobank agricultural analyst, Genevieve Steven

“With spend via food service channels much lower, retail channel food spend has increased and we’ve also seen strong growth in food delivery sales as well as sales of ‘ready to eat’, ‘ready to cook’ and ‘ready to heat’ convenience meals.”

Ms Pan said these changes were having a much bigger impact on demand for sheepmeat than they were for beef.

“Lamb is predominantly sold via the food service channel in China, particularly at high end restaurants where it is used in hot pots. And with the sales via the food service channel having fallen substantially over the last six months, Chinese lamb demand has dropped markedly and China’s overall sheepmeat imports for the first half of 2022 were well back on the previous year,” she said.

“On the other hand, Chinese demand for beef has been much more robust. Prior to the pandemic, beef sales were also heavily reliant on the food service channel, however over the last two years, beef sellers have been able to successfully shift a portion of sales from the food service channel to the retail channel. Accordingly, beef demand has held up well and, in the first half of 2022, Chinese imports of beef actually increased by two per cent in comparison to the same period last year.”

Ms Pan said Chinese demand for beef was expected to hold firm over the remainder of the year, while sheepmeat demand would continue to be constrained.

“Chinese covid policy is unlikely to change over coming months, and we expect demand for sheepmeat will stay softer as the Chinese food service sector continues to struggle,” she said.

“We also see the slowdown in the Chinese economy as a further immediate threat for sheepmeat demand as the premium food service sector – which accounts for the majority of sheepmeat sales – is likely to be vulnerable as Chinese consumers look to reduce expenditure.”

Implications for New Zealand red meat producers

New Zealand-based RaboResearch agricultural analyst Genevieve Steven said New Zealand’s red meat exports to China had grown strongly over recent years and the sector was now heavily reliant on the Chinese market.

“Demand from China has driven prices for New Zealand beef and sheepmeat to record highs over recent years and, as a result, we’ve increased the amount of product we are sending to China,” she said.

“In 2021, around 40 per cent of our total beef export revenue came via sales to the Chinese market, while this market also accounted for around 60 per cent of our sheepmeat export revenue. And this does mean we are now very exposed to China which is a risk.”

Ms Steven said the recent lockdowns in China and the resultant changes in consumer behaviour, had hit New Zealand export sheepmeat sales hard.

“Reduced Chinese demand for sheepmeat has had an adverse impact on our sheepmeat exports into this market, and over the first half of 2022 they have fallen by 33 per cent on the same period in 2021,” she said.

“However, despite the decrease in sheepmeat export volumes, sheepmeat export earnings have remained elevated, with the average price per kg Free On Board (FOB) for the first half of 2022, around $1.05/kg FOB higher than the same period in 2021.This is largely attributable to a favourable exchange rate and high global protein prices.”

With the market dynamics in China unlikely to change any time soon, Ms Steven said, there is further downside risk for New Zealand’s sheepmeat exports into China over the coming months.

“We expect our Chinese sheepmeat exports will continue to be considerably lower during the second half of 2022 than they were in the corresponding period last year and that the slowing Chinese economy and ongoing risk of lockdowns are likely to take the shine off the farmgate lamb price into the 2023 season. Recessionary risks in New Zealand’s other key sheepmeat markets in 2023 – the EU, UK and US – will also put further downward pressure on sheepmeat demand and pricing,” she said.

Ms Steven said the outlook for New Zealand beef exports into China was much brighter.

“On top of healthy Chinese beef demand, New Zealand beef producers are also fortunate that global supply of beef is tight at present. And this should help ensure Chinese demand for New Zealand beef continues to be strong and prices remain at elevated levels.”

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 customized banking and finance solutions to businesses involved in all aspects of food and agribusiness. Rabobank is structured as a cooperative and operates in 36 countries, servicing the needs of about 8.6 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 30 offices throughout New Zealand.

Media contacts:

David Johnston
Marketing & Media Relations Manager
Rabobank New Zealand
Phone: 027 477 8153

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