Livestock

Turning point for red meat

By Contributed

Aug 1, 2025

Drought and destocking are on the cards for some, but there are positive signs.

Drought conditions forced herd reductions, input costs soared, and the global market was rattled by shifting trade policies and supply chain disruptions.

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Confidence took a hit — both in the paddocks and in the markets.

In this environment, it’s easy to assume the outlook for Australian agriculture, particularly red meat, might be under pressure.

But the tide is turning, and as we look ahead to the second half of 2025 and into 2026, the reality is far more optimistic.

A sharp lift in lamb prices, strengthening global demand, and signs of recovery across key markets suggest that red meat could be on the cusp of a major upswing.

Rather than bracing for more volatility, producers now have an opportunity to act decisively — to rebuild, re-stock, and position themselves for what could be a period of strong, sustained returns.

Positive signs for producers

Across Australia, we’re already seeing signs of renewed momentum in livestock markets.

Lamb prices have reached record levels in recent weeks, and the broader trend suggests that red meat prices are poised to climb significantly.

For producers who’ve weathered challenging seasons — especially in southern regions where drought has led many to de-stock — this shift could signal an important inflection point.

For those considering re-stocking, now is the time to plan carefully.

Yes, there’s the reality that livestock may need to be purchased at prices higher than they were sold — but with strong seasonal conditions and surging global demand, the upside potential is substantial.

What’s key is ensuring the right class of stock is selected and that the business is equipped with the necessary working capital to act with confidence.

At Legacy Livestock, we’ve seen how access to the right financial tools can make all the difference.

Tailored finance solutions that reflect individual operations can empower producers to participate in the upside and harvest opportunities to maximise financial performance.

Navigating trade headwinds

One of the biggest talking points in recent months has been international tariffs, particularly in the US market.

At first glance, these trade barriers might seem like a threat to Australian exports. But in practice, their impact has been negligible.

Why? Because of strong underlying demand. The US cattle herd is still in rebuild mode after significant sell-downs caused by prolonged drought.

As producers retain females to restock, supply tightens – and prices rise. Despite retail red meat prices hitting record highs in the US, consumer demand remains robust.

This imbalance – strong demand paired with constrained supply – has created a cushion that absorbs additional costs like tariffs.

In fact, many of the margins have simply been compressed in the middle of the supply chain.

Australian export volumes continue to grow, and producers are starting to see better farm gate returns as pricing pressures ease.

Global tailwinds and opportunities

It’s not just tariffs and supply chains that are shaping the market. Currency movements are also playing their part.

A strengthening Australian dollar could influence export competitiveness, but the fundamentals of global demand remain strong enough to support rising prices.

While currency fluctuations pose some risk, this isn’t new territory for producers – and with the right planning, many are well-placed to adapt and respond.

This is a moment of strategic opportunity for Australian red meat producers. With international conditions favourable and domestic prices on an upward trajectory, those with the foresight — and flexibility — to invest now will be best positioned to thrive.