Sheep and lamb indicators on the up despite plentiful supply

Eastern NSW, Victoria, Tasmania and WA were all treated to a good dose of rain with more forecast for the next few weeks.

Enthusiastic bidding at sheep markets saw the Eastern States Trade Lamb Indicator up 28c week on week, to sit at 681/kg cwt.

While encouraging, this is still 112c (-14 per cent) below the same time last year.

In the west, trade lambs also met stronger buying activity, and the indicator picked up 59c to 542c/kg cwt, 141c lower than the same time last year.

Restocker lamb prices improved in all eastern states, but still have a long way to go before they recover from the decline that began at the end of February.

The National Restocker Lamb Indicator lifted 42c last week to 572c/kg cwt, down 281c (-33pc) year on year.

At Dubbo, lambs to the restockers were around firm selling from $96 to $135 while Merino lambs to the restockers sold from $35 to $50/head.

According to MLA market reporter, Peter Kerr, Naracoorte saw increased restocker orders and a competition for supply as they turned lambs back out from $62 to $135/head.

Ballarat contributed 42pc of the indicator but traded 19c under the national average.

Wagga Wagga made up 12pc of the contribution and had the highest premiums with restocker lambs selling for an average of 692.11/kg cwt.

The quality of heavy export lambs also improved at the saleyard.

Mercado analyst Olivia Agar reported light lambs were steady on last week, while Merino lambs lost 25c.

Heavy lambs edged higher, with saleyard reports indicating that mixed quality saw well-bred and well-fed lines improving while plainer types dragged.

"Mutton continued its upward trajectory thanks to the widespread rain," Ms Agar said.

"Both NSW and Vic saw around a 25c lift in mutton prices and the National Mutton Indicator improved another 18c on the week to 344/kg cwt."

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In good news, the stronger market was despite an increase in the supply of both lambs and sheep through the saleyards.

Reports for last week suggest over 160,000 lambs yarded and 86000 sheep.

This is an 11pc lift in combined throughput across the country compared to the week prior.

For the week ending the 24th of March, lamb slaughter in the east was 3pc below the same time last year.

Also in the east, sheep slaughter was 27pc higher than at the same time last year and continues to track well above five-year average levels.

Victoria was able to lift both sheep and lamb slaughter to 50,536 head and 168,523 head respectively.

As a total, sheepmeat exports have grown by 19pc to 38,360 tonnes year on year.

In early March, MLA reported the largest export growth for lamb was to the Middle East and North Africa which grew by 32pc to 3587 tonnes.

Mutton exports are also performing well, jumping 59pc in both China and USA.

The largest shipment of Australian market on record was the 6407 tonnes sent to China at that time.

MLA analysts say the most striking fact about these export figures is that these trends are occurring outside drought conditions.

Previous records show that the only time exports have exceeded February's numbers was in the drought of 2019/2020, when producers were shrinking their herds in the face of drought conditions.

First quarter 2023 figures will be interesting as the high export volumes seen so far this year, which surpassed a very strong 2022, bode well for sheepmeat exports in 2023.

If rain continues and heralds an early Autumn break in the east, prices may be on the up for sheep.

While this may bring confidence to the markets in the long term, the two upcoming short sale weeks due to Easter may be disruptive.