past Issue

Review & Outlook

Outlook of the Beijing Market for Goat Meat and Mutton in 2003

Generally speaking, the supply of and demand for goat meat and mutton in Beijing have been continually increasing.  Supply cannot meet the demand and has not been able to for last 9-12 months.  The supply of goat meat and mutton in the Beijing market are mostly from other provinces or municipalities such as Hebei, Tianjin and Inner Mongolia accounting for about 2/3 of the total supply.

A.   Production of Goat Meat and Mutton in Beijing

Table 1.  Inventory of Goats and Sheep and Meat Production in Beijing, 1999-2002

During the first three quarters of 2002 the total production of goat meat and mutton in China was 2.27 million MT.  The total production in Beijing was 28,000 MT, which accounts 1.2% of the total production in China.  The total inventory of goat and sheep in China at the end of September 2002 was 336.36 million head.  The inventory of goat and sheep in Beijing at the same time was about 1.7 million head, which only accounts about 0.5% of the total inventory in China.  This is an indicator that about 50% of live goats and sheep slaughtered in Beijing are from other provinces. 

In China the average off-taking rate* of goat and sheep was 70% and the average meat yield was 13.4 kg in 2001, which are similar to the world averages.  During the first 9 months of 2002, the off-taking number of goat and sheep increased 12.5% from the same number in 2001 and the meat output only increased 4.7% as compared with the same number in 2001.  This means that the supply could not meet the demand and farmers sold the goat and sheep at a lighter weight, then, the supply for the near future will be reduced and this would lead a further short supply and probably higher market prices.

*Editor’s note: Off-taking rate is a commonly used measure of production in China and is calculated by number slaughtered / total inventory.

B.    Market Price

In China’s major production areas of goat meat and mutton, the market prices of goat meat and mutton were the same during the first two quarters of 2002.  The market price at the third quarter increased 12.9%.  However, the market price of goat meat and mutton in Beijing only increased 1.53% from the second quarter to third quarter of 2002.  The average market price for the first three quarters of 2002 in China increased 4.3% as compared with the same number in 2001.  The average market price for the first three quarters of 2002 in Beijing decreased 4.4% as compared with the same number in 2001.  These numbers indicate that the market price of goat meat and mutton in Beijing market is relatively low and it has some room to increase in 2003.

C.   Consumption of Goat Meat and Mutton

The average market price of goat meat and mutton in Beijing in 2002 was 9.64% higher than the market price of beef, or 64.2% higher than the market price of pork.  In other words, the market price of goat meat and mutton is the highest amongst the major meat products.  According to some economic research the income elasticity of goat meat and mutton is greater than 1, which means that the consumers will buy more goat meat and mutton as the household income increases. The data from FAO indicated that the average annual goat meat and mutton consumption per person in China had increased from 1.5 kg in 1996 to 2.1 kg in 2001.  The continuous economic growth will lead to more demand for goat meat and mutton in China.

The short supply in Beijing will continue in near future and the market price of goat meat and mutton will increase slightly in 2003.

Copyright2001 Beseen Consulting Ltd.