A statistic posted by AuctionsPlus caught the eye this week, in terms of sheep throughput. Their current record for the volume of sheep offered on the online auction platform for a single week is 125,000. However AuctionsPlus will offer 23,000 sheep in today’s auctions alone, coming close to their weekly record in a single day. Last week AuctionsPlus offered 81,000 sheep, which was a 13,500 head increase on the previous week, and had a 87 per cent clearance rate. Are we seeing this trend elsewhere?

No, we aren’t. Actually the opposite. East coast sheep yardings have been trending well below both last year’s levels and the five year average for most of the year, and last week was no different. Less than 50,000 sheep were sold through the saleyards, 28% fewer than the five year average, and more than 40,000 fewer than the same week last year.

Slaughter tells a similar story, with the latest data (a week delayed) showing eastern states slaughter down 45% year-on-year, and Victoria alone 53% lower. Victorian lamb slaughter was only down 17% compared to the same week last year, showing sheep processing is taking the brunt of the Covid restricted meatworks – as we pointed out last week here.

The lack of supply through the yards, and assumedly straight to abattoirs too, is holding the sheep value firm. Meat & Livestock Australia’s national saleyard indicator for mutton opened the week 2¢/kg higher, at 525¢/kg, which has it trading at just 2¢/kg below year ago levels. The national Over The Hooks Indicator for mutton (medium sheep 18-24kg) is currently 528¢/kg, well down on the peaks of above 600¢/kg in June, but pretty much on par with year-ago rates.

What does it mean?

As we hold our breath to see how steep the sheep and lamb price dive will be as spring supply ramps up (and how long Victorian processing is impacted), it would seem anyone with restocker suitable stock they want to offload are getting in while they can online, hoping the currently steady lamb price, positive spring rainfall forecast and green green grass will help get them out that gate for good returns. This also starts to draw our attention to feature female sheep sales coming up in late spring and summer, and if the need to refill paddocks will outweigh concerns around the long-term impact of Covid-19 on sheep, lamb and wool markets.

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Key Points

  • Sheep throughput on AuctionsPlus at record highs as yardings and slaughter drop well below average.
  • Mutton price remains supported by low supply for now, but supply generally increases come spring/summer.
  • Sellers targeting restockers as sheep processing bears the brunt of covid-restrictions.

Click on figure to expand

Click on figure to expand

Click on figure to expand

Data sources:  MLA, AuctionsPlus, Mecardo

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