Lamb market update: prices continue to ease
07 February 2019
Lamb prices have hit a six-month low, with the Eastern States Trade Lamb Indicator averaging 647¢/kg cwt this week. Find out the latest on supply, over-the-hook indicators and prices here.
In a week interrupted by the Australia Day long weekend, eastern states weekly lamb slaughter fell 18% to 313,000 head. While this total was comparable to the same week in 2018, weekly yardings tell a different story.
For the week ending 2 February, eastern states lamb yardings totalled 123,000 head, representing a fall of 16% week-on-week and a fall of 20% year-on-year.
Although monsoonal rains have arrived in parts of northern Australia, dry conditions in the southern states remain a challenge. Many in the industry have raised concerns regarding lamb supply for the coming months, with February shaping up to be a telling month.
Across NSW saleyards, lamb yardings totalled 68,000 head, down 20% on the previous week and down 28% year-on-year. In Victoria, yardings totalled 42,000 head, falling 19% week-on-week and 9% year-on-year.
For producers selling direct-to-works, weekly over-the-hooks (OTH) indicators collected by the National Livestock Reporting Service demonstrate the continuation of a falling trend. Nationally, lambs in the 20–22kg carcase weight (cwt) category fell 1% this week to 676¢/kg cwt. Heavier lambs (22–24kg cwt) were steady at 681¢/kg cwt.
Turning to state-based indicators, heavy trade lambs remained below 700¢/kg cwt across all states for the second consecutive week. In recent months, eastern states indicators have begun to converge with prices in the west. In October 2018, NSW heavy lambs were achieving a 28% premium over their WA counterparts. This premium fell to 5% for the week ending 4 February.
On Tuesday, 5 February, the Eastern States Trade Lamb Indicator averaged 647¢/kg cwt, down 4% week-on-week. The indicator has not averaged below 650¢/kg cwt since June 2018. Restocker lambs continued to trade at a discount, averaging 619¢/kg cwt.
The Eastern States Mutton Indicator also eased this week to average 388¢/kg cwt, down 2% on the previous week.
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