Trade lamb prices reach all-time high
26 August 2021
Key points:
- NSW yardings and slaughter volumes are operating stronger than 2020 year-to-date levels, demonstrating positive flock growth and maturation
- Soft A$ and insatiable processor demand to meet international export orders and strong supply of high quality new season lambs driving price to new heights
- NTLI hits new national record, appreciating by the same amount it was in January 2002 in 12 months
Year-to-date slaughter and yardings
Year-to-date lamb slaughter for the eastern states is operating 5% stronger than 2020 levels, amounting to 568,000 head. Compared to the five-year average, year-to-date volumes are 6%, or 591,000 head, softer, demonstrating the growth the flock has made in rebuilding its significantly liquidated numbers after the drought.
With slaughter operating above 2020 levels, these figures demonstrate that 2021 lamb supply is performing above expectations. In NSW alone, saleyard lamb supply is operating 20% stronger than 2020 year-to-date levels, the equivalent of 629,000 head. Compared to the five-year average, year-to-date yarding volumes are also performing slightly better. This shows that the state’s flock is maturing, and growth through slaughter and yarding supply is evident in 2021.
These figures demonstrate to industry that the size of the lamb cohort is larger than initially expected and there is significantly more supply being delivered through improved marking rates and increased numbers of joined females. This is a result of some regions experiencing an excellent season and producer intentions to rebuild numbers, with over 40% of NSW producers expecting to increase flock numbers within the next four months. Historically strong supply is also doing little to deter processors.
The driving factors
As young lamb supply ramps up across the NSW saleyards and processors continue to dominate purchasing at the rail, supported by a soft A$ and surging international demand, lamb prices have reached record levels.
On Monday, the National Trade Lamb Indicator (NTLI) reached 951¢/kg cwt, its highest ever level. To put it into perspective, the first time the NTLI passed 313¢/kg cwt was in the week of 31 January 2002. In the past 12 months, the NTLI has risen by that amount alone, a price lift of 33%.
As the flush of new season lambs begins, high quality and well-bred lambs will demand attention, and with fresh lambs presenting in larger numbers, processor demand has remained strong to meet the growth of the US market and China’s continued presence.
© Meat & Livestock Australia Limited, 2021
