Goat and lamb OTH indicators in unchartered territory

The eastern states goat over-the-hook (OTH) indicators moved into new territory this week, lifting 11-15¢/kg cwt from last fortnight, with all categories surpassing 650¢/kg cwt. Goats (10-16kg cwt) averaged 655¢/kg cwt this week – 139¢ higher than the same time last year, and 464¢ above where the indicator tracked five years ago. Furthermore, this week the top quote for all categories reached 730¢/kg cwt. Eastern states goat slaughter was 52,970 head last week, up 13% on the corresponding week last year, with hot and dry weather across the eastern states over the last month assisting goat harvesting operations.

It is a week of new highs for national lamb over-the-hook indicators as well. Prior to this week, the national heavy trade lamb (20-22kg cwt) and heavy lamb (22-24kg cwt) indicators had very briefly and marginally breached the 600¢/kg cwt mark for the first and only time in August 2016. This week, however, the national medium trade lamb (18-20 kg cwt), heavy trade lamb and heavy lamb indicators averaged 615¢, 615¢ and 617¢/kg cwt, respectively, as processors reportedly look to secure stock. The eastern states lamb kill last week was down 10% year-on-year, to 334,346 head.

MLA forecast lamb availability to remain tight during 2017, on the back of slightly poorer lamb markings and fewer ewes joined, which will likely continue to provide support for the market. For 2017, national lamb slaughter is projected to be 22 million head, before increasing from 2018 onwards – assuming average seasonal conditions. While 22 million head is a decline year-on-year, it remains aligned with the long-term growth trend over the past 10 years. To watch the latest video summary or read the full Australian sheep industry projections for 2017, please click here.