Sheepmeat prices trend up as yardings ease

Supply tightened considerably over the past week, with the King's Birthday public holiday on Monday having an impact.

Most indicators have seen some positive movement over the past week, with the exception of restocker lamb which slipped 5c to 576c.

The best gain was in the Merino lamb indicator, which was up 70c to 595c, while light lamb was up 61c to 603c.

Meat & Livestock Australia senior market information analyst Erin Lukey said good rainfall in NSW and Western Australia over the past two weeks had helped lift confidence, driving price improvements, with lower yardings also a key factor.

"Around this time we do tend to see the tap turn off on supply or at least supply start to ease coming into the new lambing season," she said.

"A lot of the old season lambs have been flushed out of the market, we've had really high yardings consistently over the year which means we're getting to the end of that last season lamb stock, which is the classic supply demand dynamic."

Ms Lukey said mutton was also moving in a positive direction, with the indicator bouncing back to 352c.

"A lot of that would be rainfall driven and general confidence in the market, but also yardings for sheep are starting to ease out," she said.

Rabobank animal protein senior analyst Angus Gidley-Baird said at this point in time, it seemed the market was following a more normal course of events than last winter.

"Those trade lamb, export lamb prices generally from March, April onwards tended to trend upwards towards June and July," he said.

"Over the course of the next few weeks slaughter numbers should start to drop a little bit.

"Lamb slaughter is not as seasonal as it used to be but sheep supply should drop, so that's probably my only concern at the moment, both sheep and lamb slaughter are going sideways."

Mr Gidley-Baird said trade lamb prices had edged up with restocker lamb also starting to lift a bit again, which could be due to people buying restockers to try and take advantage of stronger finished lamb prices.

"Things are looking a lot more normal, albeit they are still below the five-year average," he said.

"You can see a finished lamb market slowly starting to improve as we tend to run out of those finished lambs around now and the US market is looking ok, our export numbers are picking up.

"Chilled product prices seem to have drifted a bit lower but frozen product prices seem to have edged up a bit into the US.

"May 2024 looks like it's biggest volume of exports into the US in a long time.

"It provides me with a degree of confidence if prices in the US are holding and we're starting to send more volumes there, that may indicate that market is looking a bit more positive.

"That to me is a bit of a bellweather in terms of the health of the lamb trade, if that market is doing quite well it allows the processors and exporters to leverage some of those more premium cuts, which can add value."