The lamb market has so far powered through spring at record levels, as a seasonally contracted lamb crop and historically high demand keep the momentum going. This time last year, I wrote that heavy lambs were “red hot as season hinders supply”. That week in 2024, the National Heavy Lamb Indicator closed at 842¢/kg. Last week it finished at 1139¢/kg, a 35% increase in 12 months. Up until recent weeks the fear was similar seasonal conditions would prevail, but rainfall in southern Australia and a revised flock number means this time around the heavy indicator has brought the other categories along with it, as all prices sit at seasonally unprecedented levels.
The National Heavy Lamb Indicator is currently trading at 52% above the five-year average, and 68% above the 10-year figure. It is averaging 982¢/kg for the year-to-date, which is 16% clear of 2021, when the previous annual average price record was set. Historically, the indicator climbs another 10% between now and year end, which would take it to 1253¢/kg, surpassing the record weekly average set in August of this year. Putting more prudence behind this spring’s price rise for export lambs and industry sentiment is the National Mutton Indicator, sitting 136% above year-ago levels at 735¢/kg, a 35% discount to heavy lambs compared to last year’s 63%.
The drivers are on both sides of the equation. Demand wise, record monthly levels in the first half of the year will see lamb exports close out 2025 historically high, despite not reaching last year’s record total volume. There were 24,667 tonnes sent offshore in October, which was 3% less than the five-year average for the month. It put year-to-date lamb exports 5% below the same period last year, but still 8% above 2023. China was the only major market in October which imported more Australian lamb than both the previous month and their five-year average for that month. The US, while remaining the biggest market for Australian lamb, imported their lowest monthly volume since January 2024, and year-to-date totals sit 3% lower year-on-year.
Supply wise, we haven’t had an official flock figure from the ABS for more than three years now, but Meat & Livestock Australia forecast it has contracted by 6% year-on-year in 2025, to its lowest number since 2021, the last heavy lamb price peak. This is actually less of a decline, meaning higher flock numbers, than MLA forecast in their March projections, the difference being now they expect the flock to rise back up next year rather than continuing to decline. Year-to-date lamb slaughter (MLA figures) is 10% lower year-on-year, while total sheep and lamb throughput is down 6.5%.
What does it mean?
Historically, the last two weeks of November and the first three of December are the largest total sheep and lamb slaughter weeks for the year, as we hit the peak new season flush period in the south and spring-fattened sheep are turned off before summer. For those with grass available, the incentive to keep lambs through to the new year could be enticing, with the trade and heavy lamb prices closing last week at parity. Even with a likely throughput increase in coming weeks, there is little to indicate any significant downward pressure on prices before or after Christmas, and further widespread rain could bolster sentiment even further as the flock looks to build back up in 2026.
Key Points
- The National Heavy Lamb Indicator is averaging 982¢/kg for the year-to-date, more than 150¢/kg higher than the previous record year at the same time.
- This is despite lamb exports trending below the five-year-average for the past three months, now sitting 5% lower year-on-year for the year-to-date (but still historically high).
- MLA’s lamb slaughter figure was 3% above the five-year average last week, but had been consistently below average since May.
Click on figure to expand
Click on figure to expand
Click on figure to expand
Data sources: Mecardo, ABS, MLA
