FAS/Canberra forecasts Australia’s pork production in 2024 to increase by 2% to 480,000 MT (CWE), from the upward revised 2023 estimate of 470,000 MT (CWE), according to a recent US Department of Agriculture (USDA) Global Agricultural Information Network (GAIN) report. The rapid growth in beef and lamb prices, during their short supply while these sectors were rebuilding their herd and flock numbers, has spawned an increase in consumers seeking lower cost meat protein alternatives and has encouraged growth in pork production in 2023. The strong growth in pork production in the first half of 2023 is expected to flow into early 2024. However, only a small overall growth in pork production is forecast for 2024 as a result of an expectation that lower cattle and sheep prices will filter through to retail meat prices in the back half of 2023 and into 2024. This is anticipated to trigger the onset of adjustment in pork production.

Australia exports less than 10% of the pork that it produces, and it imports far more than it exports. Australian pork production is strongly influenced by pork import prices, as well as competition from other major meat protein sources. The main competing meat protein sources for pork are poultry, beef and lamb. From 2019 at the tail end of a multi-year drought when supply of cattle and lambs for processing began to dwindle, and the three subsequent years to 2022 when supply was further reduced while cattle and lamb producers were rebuilding the national herd and flock numbers, the price of beef and lamb escalated. During the same period, although the price of pork increased it was to a far lesser degree than for beef and lamb, while the price of poultry only very moderately increased. With this price dynamic the consumption of beef and lamb fell (Note: Australia produces far more beef and lamb than it consumes, so the available supply to the domestic market is not a constraint) and was substituted by increased consumption of pork and poultry.

This shift in price dynamic over the last four years has spurred on the growth in pork production in Australia. However, the decline of over 40% in cattle and lamb prices since the end of 2022 (associated with nearing the completion of the herd and flock rebuild and an increased supply of cattle and sheep for processing) has only just started to filter through to the retail prices in the second quarter of 2023 with the beef price index marginally lower and the lamb price index stable. It is anticipated that there will be a significant decline in the retail price of beef and lamb in the second half of 2023 and into 2024. Such price adjustments may lure some consumers back towards beef and lamb and away from pork and poultry. With Australia’s pork producers being highly dependent upon domestic consumption this may trigger a shift towards moderating pork production. However, due to the lag phase from joining sows, gestation period and raising piglets to market weight, FAS/Canberra anticipates that the current growth in pork production from the first half of 2023 will continue into the second half and into early 2024 before moderating. 

The FAS/Canberra pork production estimate for 2023 has been revised upward by 11% to 470,000 MT (CWE) from the official USDA estimate of 425,000 MT (CWE). Pork production for the first half
of 2023 is at 234,025 MT (CWE), 8% higher than in the first half of 2022. Although past trends typically indicate production evenly split between the first and second six months of the year, there is an anticipation that production will be a little higher in the second half of 2023, partly driven by the weaker than usual imports in the first half of the year.