Despite an encouraging price outlook for late Autumn and Winter, the market continues to slide lower. It isn’t surging saleyard throughput that’s to blame. The number of lambs and sheep yarded over the last two weeks has been below five-year average levels. However, the number of stock going to processors is ample for the time being and it’s allowing prices to ease.
The
Eastern States Trade Lamb Indicator (ESTLI) lost 19¢ over the week, falling
back under the 600¢ mark to 593¢/kg cwt. Trade lamb supply was slightly
stronger in what was reported as a volatile market. In WA, trade lamb prices
also took a hit, dropping 46¢ to 455¢/kg cwt.
Restocker
presence in the market has dried up in recent weeks, in tandem with the season.
The National Restocker Lamb Indicator has fallen 120¢/kg cwt, or 19% since the
beginning of February. It’s currently sitting at 508¢/kg cwt which is 7¢ above
the same time last year. Wagga had the largest yarding again of restocker lambs
this week, with a lift in supply driving prices lower.
The
year-on-year price change of finished lambs versus restocker lambs paints an
interesting picture of the change in dynamics this season. Trade and heavy lamb
prices are currently sitting at 15% and 13% lower than this time last year.
That’s despite a tighter supply outlook. Restocker lambs however are sitting 1%
higher year-on-year.
A decline
in saleyard mutton throughput lent to some stability in price in the face of a
generally weaker market. The National Mutton Indicator is sitting at 221¢/kg cwt,
which is 85¢ lower year-on-year.
Next week
Forward contracts released for late autumn and winter point to plenty of upside for prices compared to current saleyard values. Tightening lamb supply gradually starts from this point in the season if you look at history, however, we will need to see rain on the ground first.
It has been a pretty devastating weekend in many Victorian sheep-growing areas, with fires raging through some prime sheep and cattle country. The consequences will
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Prices slipping despite the positive outlook
Next week
Forward contracts released for late autumn and winter point to plenty of upside for prices compared to current saleyard values. Tightening lamb supply gradually starts from this point in the season if you look at history, however, we will need to see rain on the ground first.
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Data sources: MLA, Mecardo
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Our team of market analysts are recognised as leaders in Australian Ag market analysis, providing invaluable insights to help you navigate the ever-changing commodity landscape.
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