Grass fever cases keep the market buoyant

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Flowing supply in the south caused a small dip in saleyard lamb prices this week, although a wet summer outlook from the BOM has Restockers still banging at the gate. Mutton was a mixed bag depending on where you were looking, with strong demand in WA and Victoria offsetting weakness in the other states.

For the week ending the 20th of November, east coast lamb yardings lifted 19% to see 228,129 head yarded. The free-flow of lambs in Victoria is picking up pace but still remains 5% behind the five-year average for this time in the season. South Australia also contributed to the lift, with total throughput for the week the highest it’s been this season, and 28% above the five-year average.

Lamb slaughter was slightly lower on the week prior (-3%) and even though a few more sheep were processed (+3%), the numbers weren’t quite enough to fill the gap in processing levels.

The Eastern States Trade Lamb Indicator dropped 13¢ on the week to settle at 760¢/kg cwt. This is 34¢ higher than the same time last year. The National Restocker Indicator was the only lamb category to improve on the week, gaining 5¢ to 899¢/kg cwt.

With strong restocker activity, it was timely for Angus to take a look at the booming restocker prices earlier in the week (View article) and whether there are still good margins to be made in growing out lambs.

In the West the market was generally stronger with all categories bar Merino lambs posting healthy price rises. The Western Australian Trade Lamb Indicator gained 16¢ to 661¢/kg cwt

Demand is still outstripping supply of mutton, and with the mutton to lamb discount at extreme lows, it’s providing support to the wider market. The National Mutton Indicator lifted 11¢ to 635¢/kg cwt.

The week ahead….

The summer rainfall outlook released by the BOM this week has been another boost of confidence to the restocker market. However, on the heavier end of the trade, the recent rise in the AUD has lamb looking pretty expensive compared to the same time last year for our overseas customers.

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Data sources: MLA, Mecardo.

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