ANZCO Foods Market Update - February 2026

It has been a subdued start to 2026 across many of our markets around the world.

There are a couple of reasons for that. One is simply seasonal, as North America, Europe, the UK and Japan work their way through their normal winter hibernation. The other relates to the current period of hibernation back here in New Zealand in terms of livestock availability, which is far more unusual at this time of year. That has meant that our activity in key markets has been well behind what we would normally expect during this period. It has been disappointing, but it has been out of our control given the weather conditions that have impacted virtually all the country this summer.

While market hibernation was expected, our ANZCO sales teams in the UK and Europe in particular, have been signalling that it is definitely quieter than what we would have seen at this time of year in the past. This is particularly so for chilled lamb. Customers understand our predicament in terms of livestock availability and price, but the ongoing pressure we’re putting on them means they’re retreating and being very conservative in their purchasing approach. This reinforces a message I’ve been reasonably consistent with during recent months: there is very little chance of upside in lamb market prices in the short term. It is more a case of managing downside risk.

Beef demand in the UK and Europe has been more positive, and our industry numbers were extremely strong for January exports to the UK under the FTA. A lot of that would have been manufacturing beef rather than premium cuts, and I suspect supply of the former will be sporadic as the year unfolds and we settle into a more normal trading pattern. ANZCO’s focus continues to be on building our premium beef brands in the UK, and we are excited to be actively exploring opportunities for our Angel Bay range in the UK foodservice sector this year.

The US beef market has also been relatively quiet in recent weeks, but the fundamentals remain the same, with domestic lean beef prices continuing to trend in the right direction. That ultimately flows through to the value of our manufacturing beef as well. All eyes are on the prospects for spring and the start of the traditional grilling season, when consumption naturally increases, and what that means in terms of demand for our products, both manufacturing beef and premium cuts. Again, when we look at our current situation here in New Zealand and the price we’re paying for cattle, we’ll need the US to drive value to ensure our beef business remains viable.

Japan is a mixed bag, with continuing challenges in the beef market as pricing for domestic beef remains low. We are very fortunate to have such a valued and longstanding brand in Japan in the form of Ocean Beef, sold across retail and foodservice channels. That allows us to weather adverse market conditions reasonably well, and our team in Tokyo is doing a great job maintaining momentum in a challenging environment. Lamb demand has also been mixed, particularly for chilled cuts into retail. Conversely, demand for products such as our frozen boneless shoulder has been strong, and we expect that to continue in the months ahead.

One of my Christmas wishes in my December report was that the Chinese government might forgo any decision around implementing safeguard quotas on imported beef in 2026. They obviously read my report and didn’t like the tone, because the quotas were implemented from 1 January! There has been a fair bit of handwringing and speculation about what that will mean, particularly with Brazilian and Australian volumes set well below their 2025 trade levels. I suspect things will shake out naturally during the course of this first year and that it will be very much business as usual. There is quiet optimism within the Chinese market, and we’re hopeful that this translates to better pricing for our products, particularly beef, so we can rebuild some of what we’ve given up in recent years, notably in the premium chilled space. Chinese New Year starts next week and, as always, there will be close scrutiny of the post-holiday data to see how consumers have spent and how the foodservice sector has fared. That may give us a clearer read on where things may head this year.

All in all, it has been a challenging start to the year, driven by the unusual position we find ourselves in regarding livestock supply and pricing here in New Zealand. There appears to be more rain coming for both islands during the next week, which I suspect will keep that pressure on for some time yet. We certainly appreciate your support as we work to keep our plants operating as efficiently as possible and our customers as satisfied as we can.