Sheepmeat values have flattened out in the past month, with the delayed spring flush of supplies helping prices avoid the seasonal decline that normally starts in late July/August.
The sheepmeat complex has been strong despite exceptionally large supply, as local processing capacity returned to normal, and as producers liquidated flocks in response to poor prices and adverse seasonal conditions during the second half of 2023.
Lamb slaughter has been up 17 per cent on last year and up 26 per cent on the 5-year average, while mutton slaughter has been even higher up 14 per cent on last year and a whopping 49 per cent on the 5-year average.
This chart shows sheepmeat exports to major destinations 2024 versus 2023. Source: Department of Agriculture, Forestry and Fisheries (DAFF)
Solid demand has been aiding Australian sheepmeat, with exports to the US and Middle East leading the way, offsetting some softness in Chinese demand.
While demand has been resilient for much of this year, some exporters are noting that there is resistance to higher prices, with processing margins tightening up in recent months owing to the rise in local values. Difficult trading conditions are being noted in most large sheepmeat importing countries, with the exception being the north American market where trading conditions are holding for now.
This chart shows the national weekly lamb slaughter versus last year and the 5-year average. Source: MLA
This chart shows the national weekly sheep slaughter versus last year and the 5-year average. Source: MLA
Heavy weight lamb price hold
The tough autumn in southern lamb producing areas means that there was a lack of early heavy weight new season lambs. This has supported values through early spring with agents reporting that the season is about four to six weeks behind normal.
Supporting heavy weight lamb values will be a lower overall lamb drop from a reduction in ewe joinings and lambing percentages. For example, in Western Australia, Elders Livestock Manager Dean Holland is reporting that ‘lamb marking percentages are down to as low as 50-70 per cent and that come November lamb availability will be very tight’.
With pasture conditions remaining tough across southern Australia, lambs that would have been heavy weights will be sold as stores or at lower weights. We expect heavy weight lamb values will rise gently through spring aligning with the trend in the 5-year price average.
This chart shows heavy export lamb prices this year versus last year and the 5-year average. Source: MLA
Heavy lamb indicator c/kg lw
| 6 September | +/- week | +/- month | +/- year | |
| Aust | 844 | + 4 | + 36 | + 406 |
| NSW | 847 | + 3 | + 43 | + 390 |
| VIC | 826 | - 3 | - 21 | - 375 |
| SA | 799 | + 18 | + 27 | + 408 |
The table shows the heavy weight lamb saleyard indicator price for each state against last week, last month and last year. Source: MLA
Trade lamb prices steady
The slaughter lamb complex will be supported by lower supplies, a result of seasonal conditions across the southern states.
The key impacts will be lower ewe joinings last spring as producers liquidated flocks, lower lambing percentages as ewes were joined in sub optimal conditions, and lower numbers of slaughter ready new season lambs as producers struggle to put weight on the new season lamb drop.
This chart shows trade lamb prices this year vs last year and the 5-year average. Source: MLA.
Trade lamb indicator c/kg lw
| 6 September | +/- week | +/- month | +/- year | |
| AUST | 833 | + 23 | + 21 | + 393 |
| NSW | 844 | + 24 | + 22 | + 394 |
| VIC | 823 | + 10 | + 7 | + 388 |
| SA | 756 | + 31 | + 46 | + 398 |
| TAS | 793 | + 16 | - 77 | + 375 |
| WA | 665 | - 3 | + 1 | + 246 |
The table shows the trade weight lamb saleyard indicator price for each state against last week, last month and last year. Source: MLA
Restocker lamb values flatten
This chart shows the national restocker lamb indicator this year against last year and the 5-year average. Source: MLA
Already restocker lamb values are showing some tendency for a counter seasonal fall, as availability is greater than it normally would be if seasonal conditions were normal. Like in the cattle market, with spring conditions yet to show their hand, graziers lack the confidence to step into this market.
Increased supplies of store lambs and limited demand from restockers has led to a greater than normal discount for these categories. This is set to persist unless there is a dramatic turn-around in seasonal fortunes across the southern states. In the chart below we show the 5-year average or normal discount between restocker lambs and slaughter categories compared to the discount this year.
This chart shows the difference between slaughter lamb prices and restocker lambs in 2024 compared to the 5-year average. Source: MLA
The other point to note is that there are regional differences starting to emerge based on seasonal conditions. NSW restocker lambs which normally trade at evens with Victoria have moved to a strong premium, with similar price differences between NSW and South Australia.
This chart shows the difference between the NSW and VIC restocker saleyard lamb indicator price. Source: MLA
This chart shows the difference between the NSW and SA restocker saleyard lamb indicator price. Source: MLA
Restocker lamb indicator c/kg lw
| 6 September | +/- week | +/- month | +/- year | |
| AUS | 632 | + 34 | + 39 | + 388 |
| NSW | 738 | - 19 | + 102 | + 501 |
| QLD | 508 | + 3 | + 49 | + 300 |
| VIC | 531 | + 113 | - 73 | + 247 |
| SA | 490 | + 35 | - 186 | + 253 |
| TAS | 519 | - 169 | + 92 | + 291 |
| WA | 488 | + 62 | + 63 | + 343 |
The table shows the restocker lamb saleyard indicator price for each state against last week, last month and last year. Source: MLA
Mutton prices start to flatten
The mutton price will be very much dictated by seasonal conditions. Unless conditions improve across the south, graziers will look to offload dry and CFA ewes rather than feeding these through the summer.
Mutton export markets are notoriously price sensitive, and they are no doubt adjusting to higher price levels. Overall mutton export volumes were similar in August with China taking a bit more and Middle Eastern markets a bit less.
This chart shows the national saleyard indicator price for mutton this year versus last year and the 5-year average. Source: MLA.
Sheep indicator c/kg lw
| 6 September | +/- week | +/- month | +/- year | |
| Aust | 357 | - 8 | - 25 | + 220 |
| QLD | 271 | - 19 | + 41 | + 130 |
| NSW | 371 | - 26 | - 9 | + 229 |
| VIC | 357 | + 14 | - 29 | + 207 |
| SA | 287 | + 26 | - 68 | + 160 |
| TAS | 343 | - 19 | - 124 | + 268 |
| WA | 270 | - 10 | - 136 | + 178 |
The table shows the sheep saleyard indicator price for each state against last week, last month and last year. Source: MLA.
Sources: Price data reproduced courtesy of Meat & Livestock Australia Limited.
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