Heavy lamb commanding premiums

Meat & Livestock Australia analysis of the sheepmeat indicators shows a 162c premium for heavy lamb as compared to light lamb.

The price disparity between the two categories has grown, with the light lamb indicator having averaged 30c below heavy lamb over the past five years as processors prioritise higher carcase weights.

Elevated US demand for heavy lamb has also factored in, with March export data showing Australian exports of lamb lifted 36 per cent in March from 2023 levels to 30,707 tonnes, making February and March the second and third largest export months on record.

Meat & Livestock Australia markets information officer Stephen Bignell said no Western Australian animal were qualifying for the heavy lamb indicator presently.

"Katanning makes up 4pc of the light lamb indicator and it's 200c cheaper than the national average," he said.

"So you've got Western Australian saleyards pulling the light lamb down and with the heavy lamb you don't.

"You've got some saleyards like Dubbo and Tamworth paying over 700c for some heavy lamb.

"SA is the lightest in the heavy lamb and that's at 589c."

Mr Bignell said the heightened supply meant that processors could be selective and tend towards heavier carcases.

"Trade lamb, those domestic animals have also probably followed the same trend as heavy lambs so that does show that US is driving some of it, but not all of it," he said.

Traditionally throughput of light lambs tends to increase after April until the end of the year, with it likely that weather might driver restocker demand for lighter animals.

Meanwhile the Anzac Day public holiday has led to a week of tighter supply, with yardings down across the country.

Episode 3 market analyst Matt Dalgleish said the disrupted processing scenario meant it was unsurprising to see a dip in numbers this week, with many producers choosing to hold stock rather than flood the market.

"Given the present state of markets and pricing, a little hiccough like reduced processing can play out with softer pricing but I think once we get past this period, we should be starting to see supply for sheep and lamb tighten moving towards winter," he said.

"That's probably going to underpin pricing moving forward.

"May historically is a bit of a balancing month where there's a bit of consolidation and sideways movement and then you start to see the climb begin in the back end of May and into June.

"From here on in there's no more real disruptions to the processing side until at least the King's Birthday holiday... and obviously the market tightens as well and that's accompanied by favourable price improvements for producers."

Mr Dalgleish said while the last two years there hadn't been the typical winter tightening for livestock, he expected it to be more normal this year.

"Even there's the prospect of a La Nina developing as well now, so that's only going to keep the confidence there," he said.

"If we start to get proper autumn break rains, that will also provide a lift."