03 JUN 2024

Sheep market winter forecast

Elders' Business Intelligence Analyst Richard Koch discusses his data driven forecast for the Australian sheep market this winter. 

The sheepmeat market has diverged in the past month. Good trade and export weight lambs and heavy sheep prices have improved whilst any store or lighter quality stock have struggled. Although supplies have remained large, offerings are increasingly dominated by store and lighter stock with other types in limited supply which explains the divergence in prices.

But help is on the way from a seasonal reduction in supplies. Sheep and lamb slaughter has started to flatten out and should soon start to ease seasonally which should allow prices to firm. 

This chart shows the national weekly lamb slaughter vs last year and the five-year average. Source: MLA


Demand for sheepmeat appears to have recovered with a steep fall in prices over the past year looking to have won sheepmeat back a seat at the dining table.

This chart shows the saleyard indicator price of trade weights lambs and the number of lambs included in the calculation as a proxy for supply of these lambs. Source: MLA
This chart shows the Australian saleyard indicator price of heavy export weight lambs vs the price of Australian boneless lamb legs in the US market. Source: MLA

Restocker lambs

Restocker lamb prices are being supported by the large discount to heavy weights which has crept back over $100 per head since mid-April. The cost of feeding restocker lambs on a grain ration is currently estimated at around $60 to 70 per head, providing a gross margin of approximately $30 per head, leading to good support feeder support for restocker lambs.

This chart shows the difference in the Victorian saleyard indicator price for heavy export weight lambs vs restocker lambs. Source: MLA
This chart shows the Victorian saleyard indicator price of restocker lambs. Source: MLA
This chart shows the national saleyard indicator price for mutton vs the number of sheep included in the calculation (proxy for saleyard yardings in this category). Source: MLA


The national mutton indicator has firmed throughout May as supplies of good quality heavy weight sheep start to ease. 

This chart shows the national weekly sheep slaughter vs last year and the 5 year average. Source: MLA

Supplies of sheep will now start to tighten as we head into winter and prices should continue to move higher.

Sources: Price data reproduced courtesy of Meat & Livestock Australia Limited.

The information contained in this article is given for the purpose of providing general information only, and while Elders has exercised reasonable care, skill and diligence in its preparation, many factors (including environmental and seasonal) can impact its accuracy and currency. Accordingly, the information should not be relied upon under any circumstances and Elders assumes no liability for any loss consequently suffered. If you would like to speak to someone for tailored advice relating to any of the matters referred to in this article, please contact Elders.

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