Early lambs leaving a gap in New Year supply

Early lambs leaving a gap in New Year supply


Sheep
FIGURE 1: State trade lamb indicators. A gap opened up in the state trade lamb indicators between NSW and Victoria in early December. Both indicators fell in mid-December.

FIGURE 1: State trade lamb indicators. A gap opened up in the state trade lamb indicators between NSW and Victoria in early December. Both indicators fell in mid-December.

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Lambs are in short supply and that could worsen come January says Mecardo's Angus Brown.

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PREDICTIONS that the drought in NSW would see tight lamb supply through the spring and summer appear to have come to fruition.

A crude measure of relative lamb supplies are the price differences between NSW and Victoria.

Obviously tighter lamb supply late in the season will see higher prices in northern markets.

We saw a gap opening up in the state trade lamb indicators between NSW and Victoria (Figure 1).

The spread had widened to 29¢, which equates to around $6 per head for a 20kg cwt lamb. This is similar to the freight cost from south west Victoria to NSW.  

Weekly lamb slaughter has now reached the levels of last year (Figure 2).

There were a lot fewer lambs slaughtered earlier in spring, but it seems these were never there.

Slaughter levels are being propped up by heavier lambs out of south-west Victoria this year.

In a normal season, plenty of store lambs are sold out through the Hamilton yards, but since the start of October, 12-18kg cwt lamb supply is down 36 per cent.  

With total lamb supply at similar levels, the lower light lamb supply suggests that south-west lambs are heavier this year and are being slaughtered rather than going back to the paddock or into feedlots.

FIGURE 2: East Coast lamb supply. Weekly lamb slaughter has now reached the levels of last year. There were a lot fewer lambs slaughtered earlier in spring, but it seems these were never there.

FIGURE 2: East Coast lamb supply. Weekly lamb slaughter has now reached the levels of last year. There were a lot fewer lambs slaughtered earlier in spring, but it seems these were never there.

What does it mean?

It is always fraught when you use anecdotal evidence to forecast supply, however the logic makes sense.

Fewer lambs being born overall, but similar numbers in Victoria and SA. Southern lambs are being killed earlier, filling the supply gap now, and reportedly, into January.  

After January things could get interesting as there is likely to be a dearth in supply at some stage.  This will be magnified if good rains do eventuate and a flock rebuild begins in earnest.

The story Early lambs leaving a gap in New Year supply first appeared on Farm Online.

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