Global Protein Demand and Lamb Price Forecasts

Global AgriTrends analyst Simon Quilty forecasts that trade and heavy lamb prices will reach approximately $13.50 per kilogram by mid-2026, before declining to around $9.50 per kilogram as supply increases. Quilty attributes the initial price surge to strong demand, particularly from North America, and anticipates a tightening of supply as the sheep flock and cattle herd in Australia, North America, and Brazil undergo a rebuild over the next three years. He emphasizes that while the current price increase is significant, it is not sustainable in the long term, predicting a return to a "new norm" of $9.50 per kilogram from 2028 to 2033.

Global protein demand to feed a $13.50/kg lamb price next year

Quilty identifies three key factors that may contribute to a more stable supply and price situation for lamb producers. Firstly, the processing capacity in Australia has improved significantly, with nearly 120,000 visa workers currently employed in meat processing, compared to only about 68,000 during the price crash in November 2023. Secondly, the development of the light lamb carcass trade into the Middle East and improved access to the Chinese market have created additional outlets for lamb during periods of high supply. Lastly, a notable exodus of wool growers from the sheep industry is expected to impact lamb availability, with the Australian Wool Production Forecasting Committee projecting a decrease in shorn sheep numbers to the lowest level since 1904.

Global protein demand to feed a $13.50/kg lamb price next year

The beef sector is also undergoing a rebuilding phase, particularly in southern Australia. Quilty predicts that beef prices will rise by 30% over the next two years, which will subsequently influence lamb prices due to their interconnected market dynamics. He notes that livestock liquidation often continues for months after rainfall, as producers address cash flow and debt issues exacerbated by drought conditions. This situation has led to processors being in a "short-bought" position, which may result in significant market rallies in the coming months.

Global protein demand to feed a $13.50/kg lamb price next year

Australia and New Zealand dominate global sheep meat exports, accounting for 80% of the market. However, New Zealand's sheep flock has declined by over 40% in the past 22 years, further tightening global supply. Quilty highlights that the anticipated decrease in lamb production in New Zealand will support the price outlook for Australian lamb.

Global protein demand to feed a $13.50/kg lamb price next year

Despite the positive forecasts, some industry participants express concerns regarding the sustainability of these price levels. Critics argue that reliance on external markets and the cyclical nature of livestock production can lead to volatility. Additionally, the ongoing challenges faced by South African red meat exporters, such as foot-and-mouth disease and a lack of traceability systems, hinder their competitiveness against Australia and New Zealand.

Traceability shapes prices in red meat export markets

• “I still think firmly that we’ve got $13.50/kg for lamb in next July-August (2026),” — Simon Quilty, Global AgriTrends Analyst

Global protein demand to feed a $13.50/kg lamb price next year

• “And there is a relationship between beef and lamb prices; the higher beef prices go it supports lamb prices, I believe.” — Simon Quilty, Global AgriTrends Analyst

Global protein demand to feed a $13.50/kg lamb price next year

• “Unless (South African) producers take part in traceability, we simply won’t get those good opportunities.” — Louw van Reenen, Executive Chairman of Beefmaster Group

Beef exporters face price pressure from rivals

This analysis underscores the complex interplay of supply, demand, and market dynamics that will shape the future of lamb and beef prices in the coming years.

Global protein demand to feed a $13.50/kg lamb price next year