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Predicting sheep market movements

29 April 2021

Key points:

  • Export markets continue to buoy optimism for the long term in the sheepmeat industry
  • Producers continue to face production challenges brought on by the good seasons
  • Turnoff weights will be an important consideration for producers seeking to find the best margins

The current market conditions that the sheep and cattle industries are experiencing has led to a question asked both by the media and producers countrywide – when will it end?

Supply will be the driving force behind halting current conditions, though the challenge remains in identifying when an uptick in supply will subdue overall market confidence. Producers should monitor market movements to ensure they are prepared for changes in supply and what that means for their stock prices.

Aside from excellent seasonal conditions, market confidence has been delivered via the export market and sustained demand for Australian sheepmeat. Overseas markets continue to offer optimism that future demand will hold up for high quality product. This has been a prominent factor in why breeding ewes and ewe lambs have been highly valued over the past 12 months.

Production challenges remain prevalent for sheep producers as strong seasonal conditions continue, particularly around disease and pest management and ewe body condition score while lambing. However, these challenges haven’t been enough to halt producers from reaching new commercial sale prices for sheep in Australia.

At the National AuctionsPlus Sheep store sale on Tuesday, Australian White ewes weighing 81kg with a lamb at foot sold for $649/head. Despite an increased listing this week, the clearance rate of the sale softened 11% to sit at 52%, with 35,927 head sold as at 5pm 27 April. The increased turn-off through the eastern state yardings in recent weeks can be attributed to the winter cropping season beginning and drier conditions softening confidence on the winter outlook for sheep producing regions.

Looking ahead

Producers are encouraged to monitor saleyard prices and weights to decide on the point of sale for stock. Weight will be an important driving factor if similar returns can be made turning off at lighter weights. Following the markets, indicators and saleyard volumes will support producers with making their decisions during winter months, particularly as they face less nutritious feedbases and a significant percentage of the ewe flock lambing down.

© Meat & Livestock Australia Limited, 2021