Direct-to-works lamb indicators move higher

Over-the-hook lamb indicators continued to push higher across the eastern states throughout January, and reports suggest strong processor demand in the physical market in recent weeks as well. The upturn in over-the-hook prices is typical for the January to March period, following the end-of-year low point. Interestingly though, since 2013, the seasonal November/December low point has progressively moved higher each year.  

This week in NSW, the top quotes for heavy trade lambs (22-24kg cwt) direct-to-works were 600¢/kg cwt, with the indicator averaging 587¢/kg cwt – up 79¢ from the same time last year. This is the highest the indicator has reached since August 2016. The heavy lamb (22-24kg cwt) over-the-hook indicator averaged 583¢/kg cwt this week – 75¢ higher year-on-year – with some quotes of up to 600¢/kg cwt. In the physical market on Monday this week, good quality trade, heavy and extra heavy weight categories at Tamworth attracted keen demand and sold to a dearer market trend. Buyer competition was strong at Dubbo, with trade and heavy weights recording price gains.

Heavy trade lambs in Victoria were on par with their NSW counterparts – with direct-to-works quotes reaching a top of 600¢/kg cwt this week, and the indicator averaging 587¢/kg cwt – up 59¢ from the corresponding period last year. The Victorian heavy lamb over-the-hook indicator averaged 600¢/kg cwt this week – 77¢ above year-ago levels, and is the highest the indicator has been since October 2016. At the Bendigo sale on Monday, processor demand was reportedly very strong, particularly for trade weight lambs, which lifted prices considerably.

Last week, MLA reported eastern states lamb slaughter totalled 325,480 head – underpinned by reduced processing across all states. Total eastern states lamb slaughter was down 17% from the previous week, and 6% from the corresponding period last year. Victorian lamb kill was back 2% year-on-year, at 157,567 head, while NSW and SA slaughter declined 2% and 11%, respectively, to 84,466 head and 70,439 head.