Halfway through last year the ABS changed their livestock slaughter reporting to quarterly rather than monthly. The monthly slaughter chart now has flat slaughter for the June and December quarters.
The December quarter would normally be the peak for the year, but in 2021 it was lower than the first quarter. The December quarterly slaughter figure of 5.309 million head was 3.2% lower than the March quarter, but it was 17% and 15% stronger than the June and September quarters respectively.
Lamb slaughter was 5% lower in the December quarter of 2020 than the same period in 2019, and it was at the lowest level since 2011. This helped drive annual lamb slaughter for 2020 under 20 million, to 19.91 million head. The annual lamb slaughter figure was down 8% on 2019, and 13% from the peak seen in 2016. It’s little wonder prices held strong for most of 2020.
It is interesting to look back at forecasts from earlier in the year, when Meat and Livestock Australia’s (MLA) Industry Projections pegged lamb slaughter at 21 million head. A one million head difference sounds like a lot, but to be within 5% in a pandemic when slaughter rates were artificially cut isn’t too bad.
Sheep slaughter rallied in the December quarter, relative to June and September quarters, but was still well down on 2019. The year on year fall in sheep supply came in at 47%. While December lamb slaughter was the lowest since 2011, sheep slaughter hasn’t been lower in the last 20 years of data.
Annual sheep slaughter fell 36% on 2019 to 5.955 million head. Compared to historical levels, annual sheep slaughter was not the lowest we’ve seen, with 2011 being just over 1 million head lower. After two years of very high sheep slaughter, last year’s very low levels were required to kick off the flock rebuild.
What does it mean?
December lamb and sheep slaughter figures point towards the flock rebuild gaining pace. While slaughter numbers were higher than the June and September quarters, the fact that they were well back on last year suggests more stock are being kept at home.
Lower December lamb slaughter would normally cause some concern surrounding lamb supply in the first half of this year. However, it appears many wether lambs did make their way to market, with the lower December being due to retention of females for breeding. Given this, lamb and sheep supply should be back on an upward trend starting later this year.
- December lamb and sheep slaughter was up on September, but well back on 2019.
- Annual lamb and sheep slaughter was at its lowest level since 2011.
- Lower slaughter suggests the flock rebuild started last year, and should result in higher supply later in 2021.
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Data sources: ABS, MLA, Mecardo