Brown, an English sheep farmer also runs the global livestock consultancy Gira in Switzerland, which provides research and advice for Beef + Lamb NZ and the Meat Industry Association.
He is surprised the possibility is being talked about in NZ.
“The United Kingdom government are free-traders so no tariffs but maybe some talk about the quota allocation.”
Outside of that, no-one knows what is going to happen, not even the government.
There is a possibility the European Union puts tariffs on lamb from the UK in a post-Brexit world but no-one knows the answer to that either.
Up to 97% of UK lamb exports go to continental Europe.
If tariffs are imposed by the EU there will be a short-term, severe price reaction and a very painful time for UK farmers.
Brown said the country will be hoping the Chinese and Hong Kong markets will open up for significant amounts of lamb if the EU trade is hit and beyond that elsewhere in Asia.
He believes the region is strong enough, with rapid growth in middle-class affluence, to handle extended volumes of lamb without hurting prices for existing exporters such as NZ.
There are concerns in NZ about the sheep meat quota arrangements when the EU and UK bloc is split.
However, B+LNZ chief economist Andrew Burtt is reasonably sanguine, saying the quota is an opportunity rather than an obligation for NZ.
Diversification into markets such as North America, the Middle East, China and elsewhere in Asia, chasing the best commercial returns, mean the actual supply into the Euro zone is well-short of the quota levels.
Burtt would not give the shortfall detail but said when EU people complain about the size of the quota “we can say over a drink that we could drop the prices to make sure we fill it, are you sure that is what you want?”.
Brown said the African swine fever outbreak in China’s pigs, striking at the massive pork market there, provides major opportunities for world producers of beef and lamb this year and through next year and 2021.
The shortfall in domestic pork production will be substantial. Gira estimates it at 6% and others at up to 20%. There is plenty of pork in the United States, Brazil and Europe so China will “draw that in like a vacuum pump”.
However, China consumes 55 million tonnes of pork a year and if that fall by even just 1% or 2% that is a huge gap to fill and other meats and proteins will be in demand.
There will also be a demand hit on pork because of the swine fever. Chicken is already the obvious replacement for some of that demand and well-priced to make major gains but more lamb, mutton and beef will be imported.
Gira has been neutral on the price outlook for beef and lamb but that view is clearly too conservative now.
The Chinese government will make sure the pork industry recovers and the retail price will remain under control because it is politically crucial, Brown said.
Industrialised pig farming has become bigger than small, backyard farming in the last 20 years and the government will ensure it increases further to improve health and safety practices.
Demand for beef and lamb is increasing, on very low volumes compared to pork, but in a more affluent part of the market and the government does not have a concern on price, as it does for pork.
China is the world’s biggest sheep meat market and has shown before it can increase domestic production when prices are high but, as well as not being politically sensitive, there is not a lot of grassland for expansion.
Brown said Gira is very positive on the global outlook for beef because it has a broader market than lamb but one issue is how much buffalo beef will be sold out of India.
