Ongoing pressure on New Zealand’s livestock industries – particularly environmental pressure – will prevent any major production growth in 2024, according to a new Rabobank report. 
The bank’s annual Global Animal Protein Outlook report has been released, showing animal protein production growth throughout the world will slow as margins remain tight in 2024. It warns producers and processors will need to adapt to sustain success.
After four years of growth in animal protein production globally, 2024 will see the pace slow or even decline across some protein types.
The shift comes as producers and processors navigate tighter margins due to structural changes to market conditions. Higher production costs and tighter supplies will push animal protein prices up and constrain global consumption in 2024.
Input costs and inflation are likely to fall, but will remain at a higher level than before the pandemic.
In NZ, ongoing pressure on livestock industries will stymie major production growth.
“Our expectation for 2024 is that beef production will fall slightly – down 3% – as a result of the ongoing contraction in dairy and beef herds. With more favourable seasonal conditions through 2023, we expect ewe numbers and breeding conditions to have improved, leading to higher lamb numbers in 2023/24. This, in turn, will see an increase in sheepmeat production and exportable lamb volumes in 2024,” the report says.
Prices for NZ beef and lamb are expected to show some improvement, but the upside for pricing remains limited, it says.
With forecast beef and lamb production close to the five-year average, the report says, NZ producers will be looking for an increase in global demand to support livestock prices.
“The contraction in the US beef production system should support beef export prices and, in turn, cattle prices. While increased Australian volumes will keep prices competitive, we believe a lift in US import demand should see New Zealand cattle prices trade slightly above the five-year average through 2024,” it says.
NZ lamb prices have faced softer-than-expected global demand and higher Australian volumes in key export markets – particularly China – through 2023.
“Prices dropped to their lowest levels in 10 years as a result. We believe a gradual improvement in global markets – particularly China – will support slightly stronger prices in 2024, but ongoing large volumes from Australia will limit upside,” it says.
The report says globally there will be pressure to invest in upgrading production systems to serve emerging market needs, meet regulatory requirements and cater to changing consumer preferences around sustainability. Adverse weather conditions and disease also present challenges.
“It’s a testament to the resilience and flexibility of companies along animal protein supply chains that they continue to grow production and deliver on customer expectations amid such challenging market conditions,” Rabobank’s global strategist animal protein, Justin Sherrard, said.
“Despite a cost-of-living crisis putting pressure on consumer finances, there continues to be demand for animal protein, and companies have been able to overcome challenges, from high costs to regulatory uncertainty and disease, to capitalise on it.” 
Sherrard said for companies to sustain the success of the past few years, they must adapt to market structural changes. Instead of simply riding out the storm, businesses need to take stock of their strengths and prepare to operate in an environment with high costs and tight margins.
Rabobank analysts forecast marginal year-on-year production growth in the major markets of North America, Brazil, Europe, Oceania, China and southeast Asia of 0.6 million tonnes to a total of 247 million tonnes next year. This is against a 2.1 million tonnes growth in 2023.
Poultry and aquaculture will be the only two protein groups to see production grow in 2024, predicts Rabobank, though it will be slower than in 2023. 
Beef will continue the decline seen in 2023, moving with changes in cattle cycles in North America, while pork production will also contract modestly.
Wild catch seafood will return to its longer-term pattern of declining production after a year of expansion in 2023.
Salmon looks set to be one of 2024’s success stories. Following two years of production contracting and flatlining, supply will expand by 4-5%, and its relative price competitiveness against other proteins will boost demand.
However, plant-based meat alternatives will continue their decline with customers and investors. 
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