Lamb barely holds on as mutton falls further

A glance at Figures 1 and 2 tells us much of what we need to know, and that is that producer returns will be about 50% less than the five-year average this spring. Meat and Livestock Australia noted this week that demand is still firmly being driven by the quality of stock, which means as supplies increase so too will the buyer’s ability to be selective.

Supply-wise lamb yardings were up about 12,000 head week-on-week, which was 6% higher than the same time last year. Most recent slaughter data, the week ending Sunday, also rose, but by a lot less, increasing by about 2000 head on the previous week, and 8,000 on the same week in 2022. Yardings in NSW made up a majority of the rise in lamb numbers, while Victoria and SA had fewer numbers week on week. Sheep-wise, yardings dipped slightly on the previous week, while slaughter increased. Interestingly, total sheep and lamb yardings for this week were about 15% lower year-on-year, perhaps indicating producers’ hesitation to enter the market despite a bigger flock.

Pricewise, lower yarding numbers did not help the mutton price, with the national indicator falling another 25c/kg this week, to now be very close to 80% lower than it was just 12 months ago. At just 111c/kg, this month is the first time the mutton price has fallen below $2/kg since the start of 2015, and there hasn’t been a time this decade where it has been at its current level. Over the last month alone mutton has lost 135c/kg. Merinos made up a vast majority of the indicator-eligible stock this week but traded at above-the-average prices.

The Eastern States Trade Lamb Indicator closed the week only slightly down, at 438.25c/kg, with about 11,000 more lambs week-on-week. That makes it 43% lower than the five-year average. National the trade lamb price is pretty much the same, with only 2000 head included that weren’t from the east in this week’s indicator. Wagga Wagga, NSW, made up close to a third of the ESTLI, and operated at 12c/kg premium, with Forbes, NSW, also slightly above average money with its second-largest yarding. Dubbo and Cowra, NSW, drug the price back, as did the Victorian yards which only had very small numbers – except Bendigo, which had the strongest price of the week.

Lastly, heavy lambs held fairly firm, losing just 2c/kg, which only occurred on Thursday’s indicator. Supply-wise, the national heavy indicator had a very similar number of lambs as the same week last year, at just shy of 30,000 head, but like everything else the price is still only about half of what it was then.