Ag News

Strong demand to underpin Lamb and Mutton prices

  • By: "Prime" Ag News
  • Jan 30, 2018

Key points:
  * Strong international demand is expected to continue to support lamb and mutton prices.
  * While lamb exports are anticipated to pull back slightly this year, shipment volumes are forecast to build up to new highs in 2019 and beyond as production increases.
  * Australian sheepmeat producers continue to rebuild the national flock, leading to a slight decline in sheep and lamb slaughter as retention increases.

Stable lamb production and a slight decline in mutton production is forecast for 2018 as producers continue to expand their flocks, according to Meat & Livestock Australia’s 2018 Sheep Industry Projections.

MLA’s Market Intelligence Manager, Scott Tolmie, said that while lamb and sheep slaughter are both expected to drop slightly in 2018, to 22.5 million head and 7.2 million head, respectively, carcase weights will increase.

“We are forecasting a slight increase in lamb carcase weights in 2018 which will help offset lower slaughter, resulting in a stable outlook for production at 514,000 tonnes cwt,” Mr Tolmie said.

“The story for mutton however is slightly different, with carcase weights expected to ease from the record highs of 2017. This, combined with declining slaughter, suggests we will see a small reduction in mutton production to 177,000 tonnes cwt.”

Mr Tolmie said the 2018 outlook for the Australian sheep industry was positive, with the increase in production and lift in prices recorded in 2017 underpinning the market’s current strength.

“With flat to declining production forecast this year, combined with strong, ongoing international demand, lamb and mutton prices should continue to see strong support this year,” Mr Tolmie said.

“Consumer demand for lamb has been strong, with exports hitting record highs in 2017 at 251,000 tonnes cwt as well as maintaining domestic consumption levels despite increases in average retail p...
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