A lower A$ positions mutton for success
22 July 2021
- Mutton experienced a 35% week-on-week increase in slaughter figures last week, while yardings lifted nationally by 28%
- The OTH medium mutton price for NSW has appreciated 107¢/kg cwt, or 16%, year-on-year
- The depreciation of the A$ and increased demand for mutton from international countries bodes well for the Australian mutton industry.
NSW sheep yardings jumped 15,000 head last week, accounting for 66% of the total yarding across the nation. This is the highest volume NSW has contributed to weekly sheep yardings since the beginning of 2020. This was also the largest national yarding the mutton game has seen since the week ending 15 May.
Higher yardings have translated into a significant uptick in slaughter volumes. In the eastern states last week, slaughter hit 72,000, lifting 53% week-on-week, or 25,000 head. NSW has done the heavy lifting, increasing its slaughter 58% week-on-week, amounting to 21,000 head. All other states also experienced week-on-week growth.
Increased slaughter supply has not impacted prices, with the Medium Mutton Indicator in NSW lifting the price 2¢/kg cwt week-on-week. In the last month, the medium mutton over-the-hooks (OTH) price has averaged 684¢/kg cwt, the highest average monthly price in recent memory. For Victoria, its medium mutton OTH price is sitting at 666¢ cwt, its highest price since hitting 670¢/kg cwt in early April.
The appreciation in some of the eastern states’ medium mutton prices and the uptick in slaughter volumes have coincided with the depreciation of the A$ against the US$. The A$ hit 73 US cents on 21 July. This will help support exporters as China continues its high demand for Australian mutton. Currently, it is operating 30% higher for the year-to-date for volumes exported compared to 2020. This paints a positive picture for the mutton market both domestically and internationally for Australia.
© Meat & Livestock Australia Limited, 2021