As sheep producers continue the wait for what will hopefully be a significant and widespread autumn break, supply remains the biggest question mark over how the market might move from here through to the traditional mid-winter peak. Specifically lamb supply, with less than favourable seasonal conditions having impacted both ewe numbers and lambing percentages in many areas. While official figures will be out later this month, weekly slaughter trends might shed some light on how supply has tracked so far in 2026.
Meat & Livestock Australia weekly lamb slaughter for the year-to-date is 22% lower than the same period in 2025, and 19% down on 2024. The latest sheep industry projections from MLA in September forecast total lamb slaughter for 2026 to drop by just 2%. The national lamb kill is still sitting marginally above the five-year-average, which is historically strong given the estimated significant drop in overall flock numbers.
Looking ahead, traditionally lamb slaughter is fairly consistent from here through to May, when it peaks before dipping in mid-winter before picking up pace depending on when the new season lamb trade occurs. However, for the past two years, when seasonal conditions were similar and more lambs were held over, weekly average lamb slaughter was higher in the first half of the year than the second, hitting its peak for the year at the end of April.
The most obvious indicator that lamb supply has tightened of course is current pricing. As far as the export market is concerned, demand hasn’t dramatically changed. Lamb export volumes for January were lower than both 2025 and 2024, but still 16% above the five year average. Historically strong, but not increasing. The National Heavy Lamb Indicator, however, closed last week 39% higher year-on-year, and 42% stronger than the five-year figure. The indicator is averaging 1018¢/kg for the year-to-date, compared to 805¢/kg for the same period last year.
What does it mean?
Strong flock figures, producers holding over lambs and increased lotfeeding has meant lamb supply hasn’t suffered significantly on the back of dry conditions in sheep producing areas in recent years, but we are likely starting to see the impact now. Any insights offered in coming weeks on actual ewe flock numbers will shed more light, but all other things staying equal, it is unlikely we will see a significant uptick in lamb supply, and therefore limited downward pressure on prices.
Key Points
- Weekly lamb slaughter average has dropped 22% year-on-year for the year-to-date.
- Year-to-date national heavy lamb price is averaging 300¢/kg more than the same period last year.
- Possible flock decline could equate to less lambs in second half of 2026 even with favourable seasonal conditions.
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Data sources: MLA, Mecardo
