Lamb/Sheep Market Update

Transcription

1 Lamb/Sheep Market Update Ontario Sheep Convention October 27, 2017 Jason Wood Provincial Livestock Market Analyst Alberta Agriculture and Forestry

2 Outline for Today Global Market Inventory and production Trade Consumption Prices Canada Inventory and production Price & seasonality Supply & Demand Consumers Market comments 2

3 Global Market Overview 3

4 World Sheep Flock Wool prices drop Switch to cattle Up 15% since 2002 Asia and Africa 4

5 Top Five Sheepmeat Producers Annual average 1.2% over 54 years Production + 82% Beef +148% Pork +457% Chicken +3700% 5

6 Top 10 Global Exporters (2013) 6

7 Top 10 Global Importers (2013) 7

8 Per Capita Consumption kg (2016)

9 Global Meat Indices Pork and sheepmeat -28% Poultry -23% Beef -18% Source: agri-benchmark; FAO 9

10 Global Sheep Prices 10

11 Canada 11

12 Flock Size Declines: US 27 million (1961) NZ 43 million (1982) AU 109 million (1970) Canada 180 thousand (2004) 12

13 Change in Provincial Inventories 2011 versus 2016 Census of Agriculture 13

14 Slaughter 14

15 Lamb Supply & Demand 15

16 Consumption & Market Price 16

17 Montreal Wholesale Price 2017 wholesale price up Quebec +7.2% West +13.7% 17 A1 Fresh Choice Lambs kg Hide Off

18 Strong Domestic Demand 2011 to 2016 Price index increased 9% Demand index decreased 2.8% 18

19 Lamb incidence has risen 17% on Canadian restaurant menus since 2015 Lamb Incidence across Canadian Commercial Operators 1,012 1,180 Contemporary CDR, 5.3% Midscale, 5.8% Lamb Item Distribution Food Trucks, Quick Service, 0.8% 4.4% Traditional CDR, 27.5% Fine Dining, 12.9% Upscale CDR, 19.7% Fast Casual, 23.6% Item Incidence Operators Menuing CDR= Casual Dining Restaurants CDR Segments into Upscale CDR, Traditional CDR and Contemporary CDR MDR: Midscale Dining Restaurants 19

20 Lamb is often featured centre-of-the-plate on Canadian foodservice menus; Asian-themed lamb entrees are trending Leading Lamb Formats on Top Canadian Foodservice Menus Lamb Entree Curry Bowl Lamb Sandwich Asian Noodles Satay/Kabob Mixed Grill Stir Fry Asian Combo Meal Specialty Burgers Non-Breaded Protein App Choice of Protein Asian Bowl Gyro FASTEST-GROWING LAMB FORMATS % GROWTH Asian Combo Meal 466.7% Choice of Protein Asian Bowl 180.0% Gyro 180.0% Protein Side 100.0% Soup/Salad & Sandwich 100.0% Mixed Grill 75.0% Lamb Wrap 20.0% Lamb Entree 14.3% Asian Noodles 12.0% Biryani 10.0% 20

21 The Lamb Consumer The lamb consumer skews male, Millennial/Gen Z, slightly higher Ontarian and higher-income Gender Generation Region HH Income 59% Of Men 53% Of Millennials 53% Of Ontarians 58% Of $100K-$150K Male 59% Gen Z 52% The Prairies 49% Under $25K 48% Female 40% Millennials Gen X 53% 44% British Columbia Atlantic Canada 48% 38% $25K - $34.9K $35K - $49.9K 46% 50% Boomers 49% Ontario 53% $50K - $74.9K 50% Matures 46% Quebec 49% $75K - $99.9K $100K - $150K 51% 58% 21 $150K + 49%

22 Consumers would consider ordering lamb over any other alternative protein Interest in Alternative Proteins % of consumers who would consider ordering the following Lamb Bison Rabbit Venison Elk Goat Wild Boar Guinea fowl Ostrich Crocodile Emu Musk Ox Horse Seal Rattlesnake Camel 5% 6% 6% 14% 12% 12% 11% 10% 9% 30% 29% 26% 24% 21% 39% 49% 22

23 Market Factors/Comments 23

24 Market Influences BSE High Feed Costs (RFS) Economic meltdown US drought CDN over supply Australian drought Increasing imports from AU Avian flu PEDv By-product values flat Low beef numbers Strong domestic demand/limited prod n Beef, pork and poultry prod n up Increasing global meat supplies Flat growth in major exporting countries Estimated Alberta Price 120 lb. Slaughter Lamb 24

25 Lamb vs. Steer vs. Hog Slaughter lamb prices have held up better than cattle and hogs Cattle fell 31%, hogs fell 42% and lambs fell 6% Since the low in 2016 lamb price have rebounded and found stability while cattle have remained more volatile 25

26 Comparison of Lamb Prices Ontario lamb prices average: 29% higher than Alberta 37% higher than Quebec 26

27 Ontario Market Lamb Price 27

28 Ontario Lamb Price Seasonality 28 Seasonal price index for average Ontario market lamb ( lbs.)

29 Eastern Canada Slaughter Seasonality 29

30 Dollar Support Weakening 30

31 Market Factors Volatility in commodity markets Co-product (drop credit) values improving Flat consumption (CAN/US) Increased production of beef/pork/poultry Domestic production declining Domestic demand is changing (ethnic/foodservice/healthy lifestyle) Stronger dollar Trade agreements 31

32 Trends Globally: Consumption increases developing countries Trade increase 15% by 2025 Supply increasing Changing demographics Changing diets Environmental concerns 32

33 Trends Canada: Decreasing flock Increased reliance on imports Protein: Plant vs. Animal Stable consumption at rising prices Increased foodservice offerings 33

34 Market Comments Price support remains Domestic demand Imports may tighten Australian processing capacity Reduced mutton supply (AU & NZ) 34

35 Questions Jason Wood