Heavier lambs throwing around their weight

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Finished lamb values continue to push on an upward trend while store lambs lost some ground this week. Trade and heavy weight lamb numbers flowing into yards are thinning and there is concern about how many will remain for purchase in the later months of winter.

The Eastern Trade Lamb Indicator (ESTLI) gained 30¢ over the week, to 681¢/kg cwt. The ESTLI is now sitting at levels just shy of the high at the start of May. In Ballarat, Carcoar and Tamworth, trade weight lambs achieved over $7/kg on average. The same momentum wasn’t present in the West, where trade lamb prices lost 25¢ this week to settle at 475¢/kg cwt.

Heavy lamb prices also improved this week, with the National Indicator rising 11¢ over the week to 678¢/kg cwt. Wagga saleyard reports noted that despite a total lift in lamb supply, quality pens of trade and heavy lambs were limited which ignited competition. Bendigo saleyard reports also noted that lamb quality was very mixed with more wintery lots starting to appear.

A larger national yarding of restocker lambs, particularly in central NSW, allowed the market to slide lower. In NSW, restocker lambs dropped 7¢ over the week to average 615¢/kg cwt while in Victoria restocker lambs lost 27¢ over the week to average 575¢/kg cwt. Light lambs faced a similar fate and continued on their recent downward trend. The National light lamb Indicator lost 28¢ on the week to 507¢/kg cwt, dragged down but the plainer quality appearing.

Since the start of the year we’ve seen mutton values hit around $3/kg on three times before collapsing almost a dollar. This week the mutton climb continued, with the National Mutton Indicator up another 6¢ to 310¢/kg cwt. The question is will the “high to low” trend continue for a fourth time or will some winter tightness and improving lamb values be enough to sustain prices? The latter seems more likely.

Next week

Looking at the total number of lambs through the yards and weekly slaughter rates (being at new highs) we’re yet to see supply pull back. However, on the finished end of the market lamb supply is beginning to wane which should continue the upward pricing trend ahead. 

While the WA market has been suffering, there is finally rain on the 10 day forecast for the south west in particular which can only help if it arrives to drought stricken regions.

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Data sources: MLA, Mecardo

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