THE lower Australian dollar and global demand for lamb will help maintain strong prices in coming years, according to the latest Meat and Livestock Australia’s (MLA) sheep industry projections.
MLA’s April update reported Australian lamb and sheepmeat exports for the first quarter were up six per cent year on year, and year to date prices for all categories of lamb have increased, with light lambs (12 to 18 kilograms carcase weight) up 19pc.
MLA market information manager Ben Thomas said the long term industry outlook is rosy.
Demand concern from both the US and China may cap prices this year - driven by high cold store levels and Australian lambs premium price over their own domestic product.
But the long term prospects for the sheep and lamb industry are positive, he said.
“Going forward, while there are some indications in our largest markets that suggest prices could come under pressure in the coming months - from higher global stocks and high domestic slaughter.
“Offsetting the potential downward pressure on prices will be a slowdown in slaughter, which will happen if the three month rainfall outlook comes to fruition.”
“While lamb slaughter for the first quarter has remained steady with last year, the final slaughter figure is predicted to be 850,000 head lower, at 21.4 million head, with reduced supplies becoming more prevalent as the year progresses.
“On the other hand, mutton supplies are already tightening, following two very high slaughter years. Mutton slaughter for the first quarter of this year is already back 20 per cent year-on-year, despite the dry conditions.”
Results from the wool and sheepmeat survey conducted by MLA and Australian Wool Innovation (AWI) showed seasonal conditions had improved across the country, with the amount of participants with above average conditions more than doubling, and those reporting drought conditions having halved.
The survey also showed only 10pc of respondents intended to decrease their ewe flock this year – 48pc lower than the same time last year.
