Airline Cargoes Filled With Meat as Gulf Route Transforms Trade

(Bloomberg) -- Passengers flying from Melbourne to the Gulf are almost certainly flying along with sheep carcasses down in the hold.

The strong demand for sheep meat in the Middle East means that the cargo space on passenger planes is now filled with fresh chilled lamb, hogget and mutton, according to a report by industry group Meat & Livestock Australia. With a value of A$476 million ($330 million) in 2018, the air trade between the areas overtook sea-freighted sheep meat for the first time.

The trade has soared as the number of flights from Australia to the Persian Gulf ports of Dubai, Abu Dhabi and Doha has boomed with airlines such as Emirates and Qatar Airways Ltd. adding flights. The routes now account for about 7.5% of all flights from Australia, up from less than 3% a decade ago, according to MLA -- meaning there’s also more cargo space for sheep meat to catch a ride.

Sheep meat takes up an average 68% of all outbound Australian airfreight to the Middle East and North Africa, according to the report. Flights from Melbourne -- the route with the most freight capacity -- are already near saturation with 93% of almost 30,000 tons of capacity taken up by sheep meat already, the report said.

The market is a lucrative one for Australia, with the Middle East and North Africa worth a total A$859 million in 2018 -- making it the highest value destination for Australian sheep meat ahead of the U.S. (A$823 million) and China (A$678 million).

Still, with Qantas Airways Ltd. abandoning its Dubai hub, air’s new found dominance in the trade is vulnerable, according to the MLA. Australia’s sheep farmers may have to find a new airline if they’re to keep feeding their best customers.

To contact the reporter on this story: Andrew Hobbs in Sydney at ahobbs4@bloomberg.net

To contact the editors responsible for this story: Anna Kitanaka at akitanaka@bloomberg.net, Atul Prakash

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