COLUMN: Lamb, goat demand remains strong
Prices have remained stable in WA during the past week, with crossbred lambs bid at $6.80, Merino lambs at $6.50 and mutton at $4.40.
While the numbers haven’t changed, there is still strong demand for lambs and we are heading into a period that is traditionally tighter for supplies.
Weekly processor numbers for the week ending April 26 were also very weak, leaving us 20,000 head behind the same time last year.
The weak numbers can be attributed to the Easter and Anzac Day holidays.
On the east coast, some rain and already low numbers have seen prices continue to surge.
NSW and SA are bidding $7.40 for crossbred and $7.10 for Merino lambs, at Thomas Foods, while Victoria is bidding $8.00 for crossbred and $7.00 for Merinos.
Restockers have re-entered the market with grass-fed finishing looking profitable again.
This demand seems to be at the expense of feedlotters who are still facing very high grain costs.
Forward markets also remain strong with numbers around $8.30 being reported for July delivery.
Mutton is $5 in Victoria and SA (JBS) and is price-on-application in NSW (Thomas Foods), while demand remains strong.
This is combined with the additional sheep and cattle demand from China as a result of the ongoing issues with swine fever in China.
The next few months will be interesting.
While a lot of processors nationwide operate longer weeks when stocks are strong, they’re also accustomed to going back to shorter weeks when supplies tighten in winter.
Some processors are forecasting stocks to tighten earlier than usual and if so will look at shifting to shorter weeks sooner than normal.
Red meat processing is a high-volume, low-margin industry.
With high fixed costs when operating, they require full capacity in order to remain profitable.
For cattle, east coast cattle market bids appear relatively unchanged.
Victorian prices are a bit firmer, with Victoria Valley Meat Exports bidding $4.25 for steers and heifers, $4.10 for cows and $4.05 for bulls.
The other major buyers through Queensland, NSW and SA in Teys, Thomas Foods and NH Foods, however, remain relatively unchanged.
Nationally, the first quarter saw processors put through the largest volume since 2015.
Goat prices have climbed almost as much as lamb. Beaufort River Meats prices increased by 90¢ to $8 and in SA, Thomas Foods increased prices by 60¢ to $8.40.
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