Only about 1000 lambs were offered among the 3500 sheep in the season’s end offering at Hamilton on Wednesday and the poor quality of most of the lambs meant no outstanding prices were paid.

But the lamb industry is predicting a return of stellar lamb prices for sucker lambs in October as national lamb supply continues to decline because of intensifying poor conditions across many of Australia’s key sheep production areas.

Meat & Livestock Australia market intelligence manager Scott Tolmie said it had been a year of extremes so far for the Australian lamb market, with prices soaring into uncharted territory as strong demand met tightening supply.

“Australian lamb prices have been rising strongly since April, breaking records as they smashed through the 700c and 800c/kg carcase weight marks for the first time,” Mr Tolmie said.

Annual lamb slaughter is now projected to be 22.9 million head for 2018, up two per cent on 2017, while sheep slaughter is forecast to reach 9.3 million head, up 23 per cent on 2017 levels.

“The dry conditions drove increased lamb slaughter for the first half of the year, spiking in the second quarter of 2018 as conditions worsened and producers looked to destock. This peaked in June with the highest month of lamb slaughter on record.

“With no indication of improved seasonal conditions in the short-term, reports suggest there will be greater numbers of light weight, unfinished new season lambs coming onto the market this year, as many producers in drought-stricken NSW and northern Victoria face challenging feed conditions,” Mr Tolmie said.

He said the dry conditions were reducing carcase weights, with the national average lamb carcase weight for 2018 forecast to be two per cent lower than 2017 and the average sheep carcase weight down eight per cent, at 23 kilograms.

The lighter carcase weights are expected to be countered by the year-on-year rise in slaughter in 2018 to place the total lamb production forecast for 2018 at 511,000 tonnes carcase weight (cwt), similar to year-ago levels. 

Mr Tolmie said strong global demand for Australian sheepmeat, combined with the softer Australian dollar and constrained domestic supplies out of New Zealand, had supported record export volumes and values.

The unit value of Australian lamb exports for the year-to-July reached new record highs, at A$8/kg, and was mirrored in mutton, which climbed to A$5.88/kg for the same period.

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