How we might see meat demand from China rebound: lessons to be learnt from Japan’s ‘Lost Decade’

There has been much press and speculation about China's economy slowing down dramatically due to the collapse in the property market, a dramatic fall in Chinese equities and rising unemployment of close to 25 per cent (pc) in their youth.

The concern is that China has shifted away from big stimulus packages of the past to more moderate measures, such as the recent interest rate cut, which points to a potential long-term period of slow economic growth that could last ten years.

With China being one of our major markets, what could be a negative for Australian lamb and beef producers may actually be a positive if history is any guide.

In the 1990s, Japan suffered a prolonged recession post the economic bubble of the 1980s, whereby economic stagnation and slow growth occurred for ten years - this period became known as the 'Lost Decade'.

In this article, I will compare the two periods across China and Japan to the impact on meat consumption in Japan during the Lost Decade. It discusses whether a similar scenario will occur in China today. Interestingly, meat consumption rose significantly in Japan during the Lost Decade and imported meat prices increased substantially.

What on the surface would seem like a difficult period for meat consumption turned into a boom for Australian beef exporters, and there is a strong argument that China could do the same again.