- RELATED: Cashing in on rising demand at Dubbo
LIVELY bidding on lambs right across the eastern states has forced prices to a eight-month high and left some agents asking just how high the market can go.
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At the end of trading on Tuesday The Land’s trade lamb indicator was on 592 cents a kilogram (carcase weight) – up nearly 30c/kg on last week.
Restocker lambs surged to an average of 610c/kg, which was about 60c/kg dearer.
A severe shortage of most descriptions of lambs, not just the prime ones, has processors and live exporters scrambling to fill orders.
So while the averages are heading for 600c/kg, many top end lambs sold via the saleyards have already made closing to 700c/kg. A pen of light restocker lambs at Dubbo on Monday was estimated to have made 800c/kg.
Last week there were 110,163 lambs processed, which was up about eight per cent on the week before and 22pc more than at the same time last year.
Some processors have contracts out for July paying as much as 600c/kg in an attempt to sure up supplies for the middle of winter.
Coles supermarket has a July price of 590c/kg for shorn lambs going to Gundagai and 600c/kg for lambs into JBS Australia’s Brooklyn plant in Victoria.
Elders agent Peter Cox, Wagga Wagga, said last week’s Wagga prime lamb market was a game changer for price development heading into winter.
“It (the market and prices) has certainly turned towards the vendors’ favour as the line of supply begins to ease right back,” Mr Cox said.
He said many lambs were sold much earlier in the year than normal and that’s helping to create the shortfall in supply now.
“We saw a significant portion of the lighter lambs, which might normally have gone to restockers, instead heading for the export market,” he said.
At the same time the demand from overseas continues to build.
Meat and Livestock Australia market information manager Ben Thomas said the recent weakening of the Australian dollar (hovering about US72c at the end of trading last week) compared with US75c/US76c during April was also helping to spur on competition and prices.
Lamb exports in May totaled 20,804 tonnes (shipped weight) according to figures available on Tuesday from the Department of Agriculture and Water Resources. That means shipments were up about five per cent or 960t when compared with the same time last year.
