Lamb prices soften as slaughter continues to rise

Slaughter rate rise expected to continue.

Wool
Aa

Increased slaughter volumes impact both sheep and lamb prices.

Aa

The lamb market has weakened across the country despite many of the major east and west areas enjoying recent substantial rain falls.

At the start of the week the east coast national trade indicator landed at 801 cents per kilogram, down 76c year-on-year while the heavy lamb indicator finished at 784c/kg, down a further 83c on the same time last year.

The only indicators to track above last year's levels was mutton which finished at 631c/kg, a 29c year-on-year rise and restocker lamb landed at 882c/kg which is 12c above the same week last year.

Online selling platform AuctionsPlus also reported a softer market.

First-cross ewe lambs finished the week $34 a head lower than the week prior to average $208. The clearance rate hit 64 per cent, compared to 58pc the week before.

Impacting the market are the increased slaughter volumes for both lamb and sheep, which began their rise in March.

After posting slaughter year-on-year declines of 9pc and 8pc in January and February respectively, lamb slaughter then began to rally.

According to Mercardo analyst Angus Brown, it looks like March might have seen the most lambs slaughtered in a month since October 2019.

"March lamb slaughter figures were up 4.5pc on last year, while the increase in April was stronger at 7.2pc," Mr Brown said.

"If MLA's projected target of 20.8 million head is to be hit over the next eight months, lamb slaughter will have to be 8pc higher than 2020, with the remaining lambs divided into months based on historical seasonality.

"May is usually the biggest lamb slaughter month of the year, and if normal seasonality holds, we will see it 33pc higher than last year's COVID-depressed levels."

For rest of the year, he expected slaughter rates to increase on last year's levels.

East coast lamb yardings fell 10pc for the week to see 174,993 head yarded.

Throughput in Victoria remains elevated, with yardings last week 17pc higher than the same week in 2020, and 49pc higher than the seasonal average.

Over 80,000 head of sheep were processed in the east coast last week, and although this was 16pc below the five-year seasonal average, it was 42pc higher than the same week last year.

Over in the west, the lamb market had mixed results.

Light lambs, restocker and heavy lambs all picked up an extra 20-28c/kg. The Western Australian trade lamb indicator lost 17c/kg and at 715c/kg sits 8pc below the same time last year.

With plenty of rain in the west over the week, more confidence is expected.

Aa

From the front page

Sponsored by