Raw sheep and lamb skins market in MERCOSUR

Earlier Report Observations

Between 2018 and 2020, the Mercosur market for raw sheep and lamb skins expanded in volume from 35 835 t to a peak of 41 861 t. This growth was followed by a contraction, with volume declining to 38 332 t by 2023. In value terms, the market shrank from 47.6 million US dollars in 2018 to 31.1 million US dollars in 2021, before recovering to 40.4 million US dollars in 2023.

A sharp increase in the price of fine sheepskin in Spain during 2021, driven by demand from exclusive brands using Merino lamb skin, reflected global trends for high-quality hides. This shift in demand likely influenced the Mercosur market structure, where the volume decline coincided with the beginning of a value recovery.

By 2024, the signing of the free trade agreement between the European Union and Mercosur created new export opportunities for hides, with immediate tariff reductions. Concurrently, Bolivia's formal accession to Mercosur expanded the regional market, while growth in feedlot cattle numbers in Argentina pointed to changes in the production base.

Production raw sheep and lamb skins in MERCOSUR

In kind, 2017-2020, t

Top producers of raw sheep and lamb skins, 2017-2020

World map of production of raw sheep and lamb skins, 2017-2020

MERCOSUR's production of raw sheep and lamb skins has grown for the third year in a row. In 2020, the region produced 39 736 tonnes, marking a 5.0% increase from 2019. Looking at the period from 2017 to 2020, production rose by 13.5%, with an average annual growth rate of 4.3%.

Annual dynamics of production in MERCOSUR in kind, 2017-2020, t

In value, 2017-2020, K $ US

MERCOSUR's production value for raw sheep and lamb skins has fallen for the second consecutive year. In 2020, output was valued at 33 581 thousand US dollars, showing a significant year-on-year decline of 23.4%. Over the 2017-2020 period, production value decreased by 17.7%, with a compound annual growth rate of -6.3%. The highest value was recorded in 2018 at 46 298 thousand US dollars, which also saw the largest increase of 13.5%.

Annual dynamics of production in MERCOSUR in value, 2017-2020, K $ US

Exports raw sheep and lamb skins from MERCOSUR

Exports in kind, t

MERCOSUR's exports of raw sheep and lamb skins in volume terms have declined for the second year running. In 2020, the region exported 964 tonnes, down 38.5% from the previous year. From 2017 to 2020, exports dropped by 64.9%, with an average annual decrease of 29.5%. The peak volume was in 2018 at 2 802 tonnes, while the largest decline occurred in 2019 at 44.0%, and the biggest increase was in 2018 at 2.0%.

Annual dynamics of product's exports from MERCOSUR in kind, 2017-2020, t

Between 2017 and 2020, China remained the primary market for MERCOSUR's exports in volume, accounting for 81.9% of total flows. The remaining volume was spread across various other destinations.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from MERCOSUR in kind, 2017-2020

Exports in value, K $ US

MERCOSUR's exports of raw sheep and lamb skins in value terms have decreased for the second consecutive year. In 2020, exports amounted to 814 thousand US dollars, a 55.2% drop from the year before. Over the 2017-2020 period, export value fell by 74.5%, with a compound annual decline of 36.6%. The highest value was recorded in 2018 at 3 646 thousand US dollars, which also experienced the largest increase of 14.0%.

Annual dynamics of product's exports from MERCOSUR in value, 2017-2020, K $ US

From 2017 to 2020, China was the dominant destination for MERCOSUR's exports of raw sheep and lamb skins in value terms, making up 77.1% of total flows. The rest was distributed among several smaller markets.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from MERCOSUR in value, 2017-2020

Imports raw sheep and lamb skins to MERCOSUR

Imports in kind, t

The market for imports in volume terms showed volatility during these years. Imports reached their lowest point in 2017 and peaked in 2020, with a two-fold difference between these extremes. In 2020, MERCOSUR imported 3 088 tonnes, a moderate increase of 5.6% compared to 2019. The largest decline was in 2019 at 4.3%, while the biggest increase occurred in 2018 at 102.7%.

Annual dynamics of product's imports to MERCOSUR in kind, 2017-2020, t

From 2017 to 2020, the main sources for MERCOSUR's imports in volume were the United Kingdom (38.3% of imports), Australia (16.4%), and Chile (11.9%). Together, these three markets accounted for 66.6% of total import flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to MERCOSUR in kind, 2017-2020

Imports in value, K $ US

Import values for raw sheep and lamb skins into MERCOSUR displayed volatility over the observed period. From a low in 2017 to a high in 2018, imports varied by 1.7 times. In 2020, imports were valued at 3 566 thousand US dollars, down 8.6% from 2019. The highest value was in 2018 at 4 980 thousand US dollars, with the largest decline in 2019 at 21.6% and the biggest increase in 2018 at 72.7%.

Annual dynamics of product's imports to MERCOSUR in value, 2017-2020, K $ US

Between 2017 and 2020, three key markets—Australia, the United Kingdom, and Spain—collectively represented 66.0% of MERCOSUR's total import value for raw sheep and lamb skins.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to MERCOSUR in value, 2017-2020