Rabobank’s RaboResearch Global Animal Protein Outlook 2026 reports elevated export demand supported prices throughout 2025 and will remain a key driver in the year ahead, even as production trends diverge between the beef and sheep meat sectors.
RaboResearch senior animal proteins analyst Angus Gidley-Baird said Australian lamb and sheep production was forecast to contract in 2026 following dry seasonal conditions across major sheep-producing regions in 2024 and 2025.
“The smaller flock, following very high sheep slaughter in 2024 and 2025, is likely to result in lower lamb slaughter in 2026,” Mr Gidley-Baird said.
“Improved seasonal conditions will also encourage flock rebuilding, further reducing lamb availability.”
Meat & Livestock Australia projects lamb slaughter to fall two per cent in 2026, following a six per cent decline in 2025, while sheep slaughter is expected to plunge 18 per cent.
Lamb production is forecast to ease one per cent to 607,000 tonnes.
“With lower supplies, improved seasonal conditions and ongoing export demand, lamb prices are expected to remain firm, although below current historic highs,” Mr Gidley-Baird said.
“Prices of $9 to $10 a kilogram would be more sustainable.”
In contrast, beef production is expected to remain historically high. Successive favourable seasons have rebuilt Australia’s cattle inventory, with animals now flowing through to processing.
“Production is projected to reach a record 2.86 million tonnes in 2025, up 11 per cent year-on-year,” Mr Gidley-Baird said.
“In 2026, beef production is expected to remain steady at around 2.85 million tonnes, the second-highest level on record.”
Strong production will support elevated export volumes, with the United States expected to remain Australia’s largest beef market, followed by Japan, China and South Korea.
Cattle prices in 2026 will depend largely on seasonal conditions and producer confidence, with Rabobank forecasting the National Young Cattle Indicator to sit between $4.30 and $4.80 a kilo, although deteriorating conditions could pressure prices lower.
Globally, Rabobank expects animal protein production growth to slow in 2026, with disease pressure, trade disruptions and rising costs continuing to challenge margins, reinforcing the need for efficiency, technology adoption and resilience across the supply chain.
