Will lamb’s red hot price run continue in 2018?

Producers and analysts confident prices will remain strong


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Lamb producers can expect strong prices to remain due to low supply, partly due to an expected increase in numbers of lambs being retained.

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Tony Smith, "Broadwater", Warren, took advantage of the strong December lamb market but expects the good prices should continue through January.

Tony Smith, "Broadwater", Warren, took advantage of the strong December lamb market but expects the good prices should continue through January.

As markets resume, expectations are lamb prices will maintain their buoyancy into the new year.

The market finished December at an unusually high level, at times reaching as much as $7 a kilogram (carcase weight).

Wagga Wagga Landmark livestock manager, Peter Cabot, said the year ended with yardings between 33,000 and 40,000 lambs a week and still selling to strong prices. 

“I've seen lambs make over $7 per kilo in the last six weeks and it's been really, really strong,” he said of the end-of-year sales.

 Mr Cabot credited the strong market to a lack of heavy lambs, most having been sold before they reached the heavier categories because the good prices had pulled them onto the market.

“There's not (been) many heavy lambs about because the market has been so good,” he said.

Ag Concepts’ market analyst, Angus Brown, said the strong market was possibly due to a lift in demand from export markets.

“What we've seen (last) spring is normal slaughter rates, so normal supply of lamb, yet prices have been 15 to 20 per cent higher than the same time last year,” he said.

Mr Brown expected prices to hold steady or possibly rise through the year as supply was expected to tighten.

MLA’s manager of market intelligence, Scott Tolmie, also predicted tightening supply through early 2018 which would reduce slaughter rates.

A recent survey conducted by MLA and Australian Wool Innovation found producers maintained they were going to retain more lambs, which would contribute to a restriction of supply. 

Meanwhile, producers used the December sales to take advantage of the good market.

Warren first-cross ewe and store lamb producer, Tony Smith, runs up to 5000 ewes and offloaded lambs at the strong December 20 Narromine sale.

“You look at how much feed you have, look at the paddock and if lambs are fresh, take the money and run,” he said. However, he expected the market would hold.

“They’re quoting $7 a kilo carcase weight (late December) and I think it will remain at $6.50 to $7 a kg for the year ahead,” Mr Smith said. 

With the same expectation, Ron Whitechurch, “Green View”, Young, bought 210 seven-to-eight month-old store lambs, off shears, to a top of $125 and an average of $115/head at Narromine’s December sale.

“The lamb market is going to be solid and I have plenty of feed over summer.”

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