Nutrien Ag Solutions sheep farm.

With ample supplies of sheep and much cheaper prices this year, a large portion of kill space is being allocated to mutton. This week mutton prices found some support while the lamb job was a mixed bag.

The Eastern States Trade Lamb Indicator (ESTLI) shed another 11¢ this week to end at 653¢/kg cwt, down 145¢ or 18% year on year. Trade lambs also ended the week slightly cheaper in the west, down 7¢ to 482¢/kg cwt. Heavy lamb prices have bounced after the steep decline over the previous few weeks. The National Heavy Lamb Indicator ended this week at 730¢/kg cwt. This was a 15¢ lift week on week, with the indicator sitting slightly below the same time last year (-17¢).

There was little change in restocker prices this week, but light lambs took a hit, dropping 51¢ to 537¢/kg cwt. The cheaper trend for light lambs was evident in all states. After falling 36% since early March, merino lamb prices have recovered some ground, with the national indicator gaining 64¢ this week or 14%.

The mutton market also made some gains in Victoria and New South Wales, while a slightly cheaper trend was evident in South Australia, Western Australia, and Tasmania. Overall, the National Mutton Indicator improved 17¢ to 324¢/kg cwt.

Interestingly, it wasn’t a lift in supply at the saleyards that sent prices lower last week. For the week ending the 17th of march, total lamb saleyard throughput (east and west coast) was down by almost 35,000 head or 20% week on week. Not forgetting that a public holiday in the south saw one less available sale day. Sheep yardings were also down by about 37% week on week, with an increase in WA not making up for the lower throughput in NSW and Victoria.

Slaughter numbers were also understandably back compared to the week prior. In the east, lamb slaughter was down 10% week on week, and slightly below the same week in 2022. However, sheep did fill up some extra kill space with a 27% lift on the week prior. East coast sheep slaughter was well above both five-year and ten-year average levels for that point in the season.

The week ahead….

As we reported in this week’s analysis, survey data suggests that we might not see supply follow the historical trend of tightening over the next couple of months. For finished lambs, this will put a lid on the price. For mutton, it will likely hold back the normal trend of price improvements over autumn.

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Data sources: MLA, Mecardo

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