Slaughter way back but prices steady

Sheep in Yard

Sheep and lamb markets are past the Easter break, but we’ll have to wait until next week to see how supply came through. The two Easter impacted weeks saw very low slaughter, and it will have picked up this week, with prices seemingly maintaining historically strong levels.

We can see in figure 1 that processors took the opportunity to cut back kills markedly over Easter.  In the week before Easter, there were 66,270 lambs killed per day (assuming a 5 day week).  The two weeks either side of Easter saw daily slaughter down to 36,046 head, that is 24% fewer lambs per day.

For mutton, the fall was even more marked, down 31% to just 10,306 head per day.  In winter last year we saw daily kills test these levels, but we haven’t seen things tighter at any other in recent memory.

Low slaughter rates are likely a combination of tight supply and weakening margins for export processors impacting demand. Usually when supply tightens like this, prices rally strongly, but the last couple of weeks has seen the CV-19 Indicator sit at $214/head. 

Restockers remain very active, with social media pictures illustrating the plentiful green grass in NSW.  Why wouldn’t you pay $158 (the CV-19 Indicator) for a store lamb, when grass is cheap and it can be turned out in July at $200+.

Mutton prices are benefitting from tight supply, and the weak slaughter is likely solely due to that.  At $175/head on average, and over $200 for heavier sheep, there aren’t too many unproductive sheep which will survive the winter. 

Next week

The tight supply is likely to continue which will support prices in the week ahead. There is still plenty of scope for re-stockers to build numbers on the available grass, and with the forecast for further rain they are likely to be further encouraged.

Have any questions or comments?

We love to hear from you!

Click on graph to expand

Click on graph to expand

Data sources: MLA, Mecardo

Make decisions with confidence- ask about our board packs, bespoke forecasting and risk management services
Percentiles with a background image of hay bales

Percentiles – June 2022

Mecardo’s Percentiles update for June 2022. Click below to view the latest report Grains Oilseeds Sheep and lambs Cattle Wool Dairy Fuel Percentiles are an important

Read More »

Don’t have an account with us? Join free.

You can have full premium access to all of our content with a monthly or annual subscription. 

Alternatively, create a free account to access our Insights blog and two free premium article a month!

Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published

Commodity conversations podcast cover image, a illustration of a sheep standing on a cow's back with grain either side
Listen to the podcast

Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.

Photo of a farmer surrounded by Merino sheep in dusty yards
Research: Analysis of the Australian sheep flock

In this report for LiveCorp and MLA, we analysed the historical trends in the demographics of the Australian sheep flock, examining domestic factors that influence farm-level enterprise decision making. 

Image of harvested grain pouring into a chaser bin

We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.