Heavy lamb price at highest level this year

Heavy lambs are currently performing very well, with the price at its highest level since the height of the drought during the winter price peak of 2019. Several key market drivers have delivered excellent returns for producers across several saleyards throughout NSW and Victoria in particular.

Supply and quality

• Grain assistance to lambs has ensured consistent, even lines being presented across saleyards throughout southern NSW, particularly Forbes, Griffith, Corowa and Wagga Wagga.
  • Excellent fat cover across the carcase has pushed buyers to purchase lambs for higher prices due to their finished quality.
• Wagga Wagga has had excellent supplies of heavy weight lambs in the last month, while numbers have waned at other saleyards such as Griffith and Corowa.
• This supply dynamic demonstrates the strength of the Wagga market and more broadly the current market demand for heavy weight lambs from buyers, regardless of supply.

Buyers

• Intense buyer competition, including domestic buyers competing with the exporters for certain weights, has further supported price rises as buyers pay premiums for high quality offerings.
• The increased buyer competition seems to be placing increased pressure on buyers to secure product. This means they are willing to pay significantly higher prices to secure lambs.

Current market conditions

Currently, the National Heavy Lamb Indicator is operating 27% higher than the same time in 2020. In current terms, this amounts to 259¢/kg cwt. The indicator is the highest it has been since early March 2020, sitting at 947¢/kg cwt.

Looking into the supply and average prices for the year-to-date in 2019, 2020 and 2021, heavy lamb throughput nationally in 2021 is 17%, or 1.54 million head, higher than 2020 volumes and 19% higher than 2019 volumes, amounting to 1.74 million more lambs. The average price in 2021 year-to-date is 19¢ softer than average price of 2020 for the same period, which was 840¢/kg cwt, albeit with 1.54 million more lambs put through the saleyards. Compared to the record-breaking year of 2019 for lamb prices, the average year-to-date price in 2021 is operating 59¢ higher, averaging 820¢ compared to 761¢/kg cwt.

As the excellent season and softer grain prices have both supported the uptick in heavy lamb supply in 2021, this has not damaged buyer demand to secure these lambs at the saleyards.