Lamb and sheep prices succumb to supply

Prices reduce as saleyards swell

Sales
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Both lamb and sheep prices have succumbed to supply as the anticipated spring flush hits its sweet spot and saleyards swell.

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Both lamb and sheep prices have succumbed to supply as the anticipated spring flush hits its sweet spot and saleyards swell.

Last week the Eastern States Trade Lamb Indicator (ESTLI) dropped 31c over the week to 822c/kg carcase weight (cwt).

The ESTLI has now fallen 8.6pc in the last two weeks albeit remaining higher than the same time last year.

Trade lambs also came under pressure in the west, dropping 20c to 729c/kg cwt.

Mutton prices fell below the same time in 2020 also on the back of larger yardings.

On Monday, the national mutton indicator was back to 566c/kg.

The increased yardings are reported to be driven by farmers discarding ewes post weaning and a large increase in wethers being offered by WA producers post shearing into the live export trade.

And as Victoria and NSW come out of lockdown hibernation and put a big influx of demand in the food service and restaurant sector, the question begs - how is the supply of lambs in the paddock going to flow in the months ahead and is there going to be the workforce out there to process them and get them on to restaurant tables?

According to industry experts, two things are certain - there is going to be a large supply coming through and there will be opportunity.

Nutrien Ag Solutions livestock manager Ron Rutledge said domestically supply should be able to reach the returned demand, and for producers, as the good season continues, there is opportunity to take lambs forward.

"Nearly eight million people have been locked up between Sydney and Melbourne, all of a sudden everything is open," Mr Rutledge said.

"The restaurant food service has basically been empty and now there is massive demand for protein in the restaurant business.

"It will be a two-story event processing structure - the processors are wondering where they are going to get the workforce to process, and where are they going to get the lambs.

"But on the wholesale part they know they have supply a lot of lambs to a lot of customers and they are wondering how they are going to do it.

"So it's a real see-saw that the industry has to provide to try and template as far as a plan goes."

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Lamb prices ease as yardings increase

To wade through the flush and to the end of January, Mr Rutledge advised producers to take advantage of the current swell of lambs and buy them at the slightly reduced prices.

"Take advantage of the volume of lambs that are coming forward over the next two to three months. The old story - 'the day you buy the lambs is the day you make your money'," he said.

"There is going to be a fairly considerable grain harvest come on board, and although the price hasn't really come back or cheapened yet, I think people are looking for that to happen to counteract the extra buy-price."

"But the heat has come off the prices which is making lambs very much more buyable. Use your grain, use your rotation of your paddocks, it's a great opportunity to do a double trade."

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