Sheep indicators fall: Large yardings of sheep drop prices

Sheep and lamb prices have taken a dive with big numbers coming forward. See what prices experts predict you’ll see in March.

A larger volume of sheep and lambs being pushed through the yards has seen prices ease significantly. Picture: Zoe Phillips

Sheep and lamb prices have seen falls of up to 60 cents in recent weeks due to a surge of numbers coming through the yards.

At the end of last week all the eastern states sheep indicators were all running in the red.

The Merino lamb indicator took the biggest dive, plunging 59 cents to finish at 703c/kg – 101 cents below levels last year.

The heavy lamb indicator finished at 790c/kg last week, a fall of 33 cents from the previous week and a 69 cent drop on last month while the national trade lamb indicator finished at 814c/kg – 12 cents down from the previous week and 58 cents lower than last month.

But industry experts say the surge in numbers driving the price fall is normal, particularly when taking into account Covid disruptions and the flock rebuild over the past two years.

“I’d still say they are strong prices – they’re still tracking well above the five-year-average prices but they’re just starting to reflect that increase in numbers coming through the system,” Rabobank Australian senior animal protein analyst Angus Gidley-Baird said.

“With plenty of feed around I think some producers also decided to hold onto their lambs towards the end of last year to put some extra weight on them,” Mr Gidley-Baird said.

Prices began to stabilise in early sales this week, with the latest figures showing a five cent lift in the trade lamb indicator, a six cent lift in light lamb and a 20 cents lift in mutton.

The indicators finishing at 823c/kg, 833c/kg and 567c/kg respectively.

But a large supply of lambs held over from last year has pushed the heavy lamb indicator down another 18 cents this week to finish at 796c/kg.

Referring to trends in weekly yarding figures Thomas Elder Markets analyst Matt Dalgleish said lamb numbers yarded for both Victoria and NSW were now at or above the five-year average.

“The lamb numbers have rebounded back to that average trend whereas if you look a several weeks prior those lambs numbers were below average,” Mr Dalgleish said.

“Now those lambs have started to come forward we’re seeing this price pressure in the last few weeks.

“There will still be some lambs to come forward through March but as we head into winter it will only really be those heavier old lambs people have held onto that see the price pressure.

“As we head into April supply will start to tighten up and we’ll see these (price) movements down start to dissipate over the next month.”