THIS year looks like closing with a whimper rather than a bang for livestock producers across northern Victoria and southern NSW.
After a sustained run of historically high prices for sheep and cattle, the market has suddenly started to cool off – and cool off fast.
The signs were already there at the last Ouyen sale of the calendar year, on November 10, as sheep prices took a tumble.
Ouyen Livestock Exchange spokesperson Jacqui Gibson said 8033 lambs and 4636 mutton were yarded at the sale for a total of 12,669.
She said the trend over all grades of lambs, heavy and light, was $20 to $30 cheaper, while mutton dropped from $10 to $20.
She said in the new season lambs, exporters made $170-$205 (650-680c/kg), while trade lambs ranged from $156-$168 (700-710c/kg).
“And in the mutton offering, light sheep saw $38-$116 (430-470c/kg) and the heavier lines made $120-$150 (380-420c/kg),” Ms Gibson said.
“The Elders catalogue topped the day, with a line-up 54 crossbred suckers from Brown Ag at Underbool knocked down at $205.
“Sale high for BR&C and Nutrien AG was also crossbred suckers – a line of 47 from W. Schultz at Mittyack was knocked down for $202.”
At Swan Hill Regional Livestock Exchange, at its final cattle sale for the year on December 1, most regular buyers were in attendance for a market that was also falling.
Elders livestock manager Matt Rowlands said all weights and grades were supplied for the sale, seeing quotations fall across the board.
He said cows fell 20c/kg to 30c/kg while heavy cattle sold as much as 30c/kg cheaper. Feeders also fluctuated, to finish between 25c/kg to 40c/kg down in all grades.
The next Swan Hill prime cattle market will be until February 9, from 7.30am with its next sheep and lamb sale February 2.
“Our sale topper was a pen of Pooncarie store calves, which saw a price range of 700-746c/kg average 738.6c/kg for GR & CMP Crozier,” Mr Rowlands.
Mecardo analyst Adrian Ladaniwskyj said the past week’s price falls may have put off some producers as supply reduced, but not enough to counter the prevailing lacklustre sentiment of soft demand.
He said the result was another week of steep price falls; with the cumulative impact over the past month really starting to add up.
“East Coast slaughter for the week ending November 25 rose 33 per cent (week on week) to 102,176 head, with processors picking up the pace in advance of the typical Christmas holiday shutdown,” Mr Ladaniwskyj said.
“The kill rate this year has exceeded 2021 by 10 per cent, but even at this level it’s a light year, at 18 per cent below the five-year average,” he said.
“The eastern states Young Cattle Indicator (EYCI) fell 51c/kg (6 per cent) week on week, closing at 876c/kg carcase weight.
“In the space of just a month, the index has now plummeted a total of 149 cents – or 14.5 per cent.”
While Mecardo sheep analyst Angus Brown described the past week as “interesting” in sheep and lamb markets, he added the falls in the market were hardly unprecedented.
Mr Brown said it was in July that lamb prices last collapsed and the industry had seen similar falls in October last year.
“But this week we delve into export data for answers, and it’s not looking pretty,” Mr Brown said.
“In the past 10-15 years the markets for Australian lambs have shifted.
“Domestic consumption used to account for more than 55 per cent of production but in 2021 we only ate 33 per cent of lamb production locally.
“Like beef and mutton, the major driver now for lamb prices is export demand.
“The latest export figures for November somewhat confirm what the anecdotal evidence has been suggesting – November lamb exports were down 12 per cent on October, and the main contributor to lower exports was the US market, which took 24 per cent less lamb.
“Lamb slaughter rates were similar in November compared to October, which when combined with lower exports means either more lambs heading to domestic markets or ending up in freezers.
“When we add in the fact that demand for store stock is at an all-time low, we get a perfect storm of strong supply, weak export demand and weak restocker demand.”
