Analyst Intel

10 July 2020

PULSE: Little venison is being exported

The temporary closure of the global restaurant industry under covid-19 has taken a hefty toll on venison and the size of the blow has become especially clear in the latest set of industry data.

At the farmgate level everything appears relatively stable. Competition between processors for market share has kept venison slaughter prices either steady or firming each passing week. Last week schedules ranged from $6-$6.20/kg.

Some of the mild buoyancy came from the re-entry of deer co-products such as pizzles into China. They were locked out for a while as deer fell under China’s wild food ban. 

There were reports of improving interest from China around venison cuts, too, given their lower price. However, complications have arisen at Chinese ports with customs inspectors adopting an extremely vigilant approach after imported Norwegian salmon was blamed for the latest wave of covid-19 in northern regions.

Things look fairly sad in bigger picture for venison, too. 

The main red flag is the variance between production and export data. Through March-May deer slaughter tallies were 8% higher than last year based on a 14% jump in hind culling. Yet StatsNZ reports venison export volumes fell by a third through the same months, implying there is a lot of venison either being routed to local consumption or, more likely, being put into storage. 

The figures have worsened with each release, too, given May exports were half those reported a year ago.

Trends are consistent for the most part through key venison markets. 

Areas such as North America, China and secondary European nations typically got 40% to 60% less product than last year through March-May. Britain did buck the trend, though, taking much more than usual and jumping to be the third-largest venison market from eighth last year. Germany held up well for a while but shipments there tanked from 630t in March to 105t in May.

With the chilled venison season rapidly approaching, beginning September, there are big question marks around whether the usual premiums will be there for finishers who target this period. 

European buyers appear happy enough with the price of NZ venison. It is more a case of needing to move existing inventory to free up room before making new orders. 

We can safely assume last year’s schedules of about $9.50/kg through spring are out of the picture.

Even longer term, the picture isn’t that great. 

How venison tracks is heavily tied to how well the global economy is humming. Consumers are much more likely to splurge their money on high-end dining or premium food products when confidence in financial security is high but quickly do the opposite when things change. 

As we all know, the world economy is looking shaky to put it lightly.