What's driving recent processor competition on lambs?

Agents say while the market is well behind the highs of last year, producers who present prime-conditioned, well-shorn lambs for sale are still attracting plenty of processor competition.

The NSW Trade Lamb Indicator was steady at 733 cents a kilogram early this week and up about 20c/kg on a month ago.

Paul Alchin, Christie and Hood, Dubbo, said the best lambs were selling well to strong competition at Dubbo saleyards, but to get the good money the lambs needed to meet buyer specifications.

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"The good lambs are well presented, shorn, and finished with some grain supplementation," he said.

"Certainly, the wet winter meant that stock struggled to do well, but the bulk of the numbers have been moving through the saleyards at a steady pace here in Dubbo."

Mr Alchin estimated the numbers were now back to pre-drought supplies and said any further expansion in the flock would be price driven into the next 12 months.

"The current prices may not entice people into further growth, but it should maintain the current levels," he said.

"What we are seeing, price wise, is following a similar trend to the past 10 to 12 weeks where the better lambs are selling well, but anything that's not well presented is not attracting the same level of competition."

Lamb quality, finish and fat cover would be the key determinant of prices received this year due to the large supply available according to Meat and Livestock Australia's national sheep industry projections released on Tuesday.

And while agents in NSW saleyards were skeptical about any significant price rise in the lamb market this year, MLA analyst Ripley Atkinson didn't provide any price forecasts in the projections report.

"The sale of 2022 lambs may place pressure on prices from a processor demand perspective as the year continues," Mr Atkinson said.

He said the national flock was expected to hit 78.75 million this year. But, the growth in NSW was not anticipated to be as hefty as flock expansion in other states.

Mr Atkinson was upbeat about the fortunes of the lamb industry and said next year lamb slaughter would hit a record 23.2 million head.

"This would be a rise of three per cent, or 560,000 year-on-year and higher by 1.1m head or 5pc on the 10-year average," he said.

Despite weather forecasts of a drier second half for 2023, lamb carcase weights were forecast to remain high at 25.1kg.

Mr Atkinson said this would be 11pc, or 2.5kg/head, above the 10-year average and attributed this lift to genetic gains across the national flock in recent years.

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