WA lamb producers living off the fat of lamb price spike

Zach Relph and Bob GarnantCountryman
Boyup Brook lamb producer Justin Corker is relishing the strong saleyard sheepmeat prices.
Camera IconBoyup Brook lamb producer Justin Corker is relishing the strong saleyard sheepmeat prices. Credit: Bob Garnant / Countryman

A supply squeeze has sent Australia’s lamb value skywards, toppling saleyard price records nationwide on the back of hungry processors’ eagerness to buy sheepmeat.

Zach Relph and Bob Garnant report:

On a cloudy winter morning, Justin Corker nestled among the flock of farmers and livestock buyers gathered at the Katanning Regional Saleyards.

The lamb producer and wife Kylie made a 90km journey from their Kulikup farm, near Boyup Brook, last Wednesday to the Great Southern livestock centre with 84 White Suffolk-Merino crossbred lambs.

While confident the pen would fetch an attractive price, Mr Corker doubted the July drop would garner the $260 a head he secured for a pen of 38 White Suffolk-Merino crossbred lambs on May 29.

However, he would happily stand corrected.

A spate of strong sales amid strong sheepmeat demand led to 16,122 head of sheep and lambs yarded at the Katanning auction — a massive 10,428 head spike from the previous week’s sale.

Justin Corker at last Wednesday’s Katanning Regional Saleyard auction.
Camera IconJustin Corker at last Wednesday’s Katanning Regional Saleyard auction. Credit: Bob Garnant / Countryman

Of the total yarding, 6000 lambs were on offer.

A sense of positivity was evident among farmers present at the sale, trying to claim their stake of the burgeoning market with processors still willing to delve deep into their pocket for lambs.

When the hammer fell on the Corker’s pen, sold under the Primaries WA banner, for a whopping $240 a head to WA Meat Marketing Co-operative, Mr Corker was ecstatic.

Though the result did not beat the family’s best effort of $260 per head, he said it was always pleasing to be a sale-topper.

“We are very happy,” he said.

“I didn’t expect this run of prices to continue for as long as it has, but it has been a bit of a perfect storm with the lack of supply.

These lambs had been on green for a while now, so they were pretty solid.

A day earlier at the Muchea Livestock Centre, about 320km north-east from where the Katanning sale action unfolded, lambs were also commanding wads of cash.

There were 4219 lambs yarded, down 1281 head, but buyers were still salivating for the protein with heavyweight lambs up to 28kg returning up to $234 a head.

Trade weight lambs from 20kg to 22kg also reaped dividends, making between $180 a head to $211 a head to return about 878¢/kg carcase weight.

The “perfect storm” described by Mr Corker has been born out of the country’s dwindling lamb supply after last year’s devastating Eastern States’ drought forced farmers to increase ewe culling.

At the peak of WA’s hiking lamb value on June 5, Nippering crop-sheep farmer Dale Cronin claimed a State record when he sold a line of SAMM ram lambs for a staggering $289 per head at Katanning.

The result eclipsed the Corker’s $260 a head WA record set seven days earlier.

Hillside Meat Processors senior livestock buyer Chris Medcalf, left, was the volume buyer at Katanning last Wednesday.
Camera IconHillside Meat Processors senior livestock buyer Chris Medcalf, left, was the volume buyer at Katanning last Wednesday. Credit: Bob Garnant / Countryman

Across the Nullarbor, price highs have been stronger than WA, with farmers taking home record returns up to $350 a head in NSW and Victoria.

The Eastern States Trade Lamb Indicator last month broke 950¢/kg for the first time as the market still waited for the new season lambs to arrive.

The delay in Eastern States’ new season lambs allowed competition for finished lambs to continue to dictate the sheepmeat’s price.

Primaries auctioneer Peter Sheridan, who auctioned the Corker’s pen, said he was confident WA prices would be maintained once early season sucker lambs hit market.

“We are hoping sheep values hold depending on the flow of numbers through the yards,” he said.

Another factor will be when new season’s suckers begin to flow through around mid-August with quality beginning to take hold from recent State-side rainfalls.

According to Meat and Livestock Australia, national lamb yardings slid last month — dropping 32 per cent from June’s figures.

WA, South Australia and Tasmania had notable difficulties filling saleyards, with weekly throughput down more than 60 per cent across the three States from June.

Mecardo senior market analyst Matt Dalgleish said international sheepmeat demand, namely from China, would ensure saleyard lamb prices would be maintained during the spring.

“Historically, WA prices come down in early September and that’s aligned with the Eastern States ... it can be anywhere from a 15 per cent to 30 per cent decline from winter peaks,” he said.

Primaries auctioneer Peter Sheridan, centre, is upbeat about lamb value.
Camera IconPrimaries auctioneer Peter Sheridan, centre, is upbeat about lamb value. Credit: Bob Garnant / Countryman

“Worst-case scenario, WA light lambs could drop to about 600¢/kg if there is a strong sell-off but I don’t think we will see a big drop-off in prices this season because we are still seeing a big offshore demand.”

The ESTLI last week closed down at 926¢/kg cwt after saleyard lamb prices across the country dropped 1.7 per cent.

Though the market’s winter supply is tightening, Mr Dalgleish said the national indicator had taken a backwards step as many Eastern States farmers prepared for the looming spring flush.

“Producers will be conscious that the spring flush is just around the corner,” he said.

“Last season the ESTLI peaked in late August and declined 23 per cent over the month of September. A similar magnitude drop this season would place the ESTLI at around 730¢/kg cwt.

“East Coast lamb weekly slaughter levels are heading towards 250,000 head and the average seasonal trend shows that slaughter levels usually begin to increase from the winter trough in late July.”

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