Weekly sheep and cattle market wrap

Cattle prices remained firm across most categories this week, while buoyant sheep supply did little to dampen prices as slaughter reaches two-year highs.

Cattle prices firm

Across most cattle indicators, prices continued to operate with more stability, with minimal changes across most categories.

High supply of processor cows in the saleyards did not overly affect prices, with the improved processor cow price falling 2.5¢ week-on-week to finish at 281¢/kg live weight (lwt).

Since late January, the indicator has operated within a tight band of 280–284¢/kg lwt, signalling the market is now operating in a new state of equilibrium. This is despite higher supplies of slaughter weight cows in the system.

For the restocker yearling heifer indicator, prices fell 16¢ week-on-week to finish at 353¢/kg lwt.

Analysis of weight data suggests that heavier heifers close to joining weights have been less affected in price terms than the 200–280kg heifers, which require growing out prior to joining. The 330–400kg weight range lost 10¢ this week, although it’s currently operating at a premium to both the 280–330kg and 200–280kg weight ranges. This indicates there is a producer demand for ready-to-join or close-to-joining weight heifers, and producers are opting to manage their land and grass availability as autumn/winter and the dry season approaches.

Lamb market

Sustained demand for heavy lambs is ensuring prices for the improved indicator finished this week at 797¢, operating 37¢/kg carcase weight (cwt) above 2022 levels.

Weight continues to dictate price performance, with heavier lines of lambs supporting higher prices.

The key selling centres of Dubbo, Wagga Wagga, Forbes and CVLX Ballarat all operated at strong premiums to the national price. The SA Livestock Exchange accounted for the cheapest heavy lambs this week, offering prices 104¢/kg cwt below the national average.

Young lamb yardings supply have begun to decline in recent weeks from their yearly high at the end of January. This indicates most lambs now offered are considered the older cohort and are over five months of age. Lamb yardings (five months or older) are operating 44% or 44,000 head higher in year-to-date terms compared to 2022. This has not significantly affected lamb prices, particularly heavy, export-orientated articles.

Mutton prices remain resilient despite supply strength

For the week ending 24 February, ewe and wether yardings are operating 60% and 97% higher in year-to-date terms than 2022 volumes. This equates to an extra 48,956 head of mutton through the saleyards.

Despite higher offerings through the yards and slaughter continuing its upward trend, the improved mutton indicator price strengthened this week. The indicator’s price lifted 12.7¢ or 4% to finish the week at 329.8c/kg cwt. Comparing month on month, this is an improvement of 22.2c or 7%.

Although the indicator has seen volatility in recent weeks, the fundamental demand for mutton remains strong despite higher supply and interest in the export markets which has meant prices are reacting accordingly.

Slaughter

Last week, cattle yardings reached their highest level for the year and slaughter numbers remained firm week-on-week at 107,000 head.

NSW and Queensland declined week-on-week, although remain well above the corresponding week for the past two years. While Victoria is operating above corresponding weeks in 2022 when processing plants were closed or at limited capacity due to COVID-19, it remains well below the first reported weeks of 2021.

For national slaughter to reach Meat & Livestock Australia’s Cattle Projections 6.6 million head forecast, Victorian production needs to lift processing capacity significantly for that figure to be realised.

The number of processor-bought cows in the saleyards has increased by 43%, or 10,000 head, year-to-date compared with 2022 volumes, indicating that producers are turning off non-performing or cull females from their herds.

Sheep slaughter hit 179,000 head last week, the highest level since January 2020. Compared to the corresponding week in 2022, current slaughter rates are higher by 55% or 64,000 head. This data is again reinforcing MLA’s expectation that sheep slaughter will rise by 1.5 million head this year as producers turn off cast-for-age or non-performing ewes from their flocks.