Supply was very reactive to the conditions this week as lamb numbers scaled back in response to the market opening last week. At the same time, the shine on the mutton market wore off.
Despite the decline in supply, the market is still keen to retrace some ground from the December highs. Processors aren’t shying away, as we saw 470K lambs processed last week per the NLRS. This level of demand will support the job while the later spring lambs are cleaned out.
The Eastern States Trade Lamb Indicator (ESTLI) lost 10¢ to 800¢/kg cwt despite the drawback in supply seen at the yards this week compared to last. With the market reverting to price levels seen in November as opposed to the highs of December, there was a notable decline in the throughput of stock that qualified for the trade lamb indicator at the yards this week (39% lower week on week). Trade lambs improved 30¢ to 789¢/kg cwt in WA (WATLI) and are closing the gap on the East Coast (See Figure 1).
An influx of sheep to the yards after mutton’s miraculous start to the year saw the pricing momentum collapse for the National Mutton Indicator which finished 74¢ lower to 359¢/ck cwt. Volatility is nothing new for mutton markets, but the market remains 65¢ higher than this time last year.
Angus Brown took a look at the impact of growing slaughter capacity and what that could mean for short-term supply into the processing sector for Mecardo this week (read more here). It looks like producers prioritised growing lambs on the last of the spring feed and sold sheep in November and December. This saw a supply squeeze on lamb causing a boom in prices for the last fortnight of 2024.
Next week
Restockers in eastern sheep regions are probably not that impressed with the rain gauge over the Christmas break. This will mean the processors will have the added luxury of being a bit pickier than in December. This will continue to impact lambs that are at the tail-end of quality at the yards, for the next few weeks.
The lamb market has so far powered through spring at record levels, as a seasonally contracted lamb crop and historically high demand keep the momentum
The big spring store sales are progressing through the Riverina, and it coincides with rapid spring growth in high rainfall zones further south and east.
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Yardings react to softer opening
Next week
Restockers in eastern sheep regions are probably not that impressed with the rain gauge over the Christmas break. This will mean the processors will have the added luxury of being a bit pickier than in December. This will continue to impact lambs that are at the tail-end of quality at the yards, for the next few weeks.
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Data sources: MLA, BOM, Mecardo
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Low flock leads to high priced heavies
The lamb market has so far powered through spring at record levels, as a seasonally contracted lamb crop and historically high demand keep the momentum
Lamb lifts despite market rush
Strong processor demand for new season lambs and rain falling in the southeast of the country put the lamb market in the green this week,
Taking a punt on merino lambs?
The big spring store sales are progressing through the Riverina, and it coincides with rapid spring growth in high rainfall zones further south and east.
Market kicks as quality starts to arrive
The story of supply has been driving the market since Winter, and demand has been reactive. Last week, there was movement at the station when
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Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published
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.
MEET THE TEAM
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.
SERVICES AND CAPABILITIES STATEMENT BROCHURE
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.