Money in mutton

Sheep slaughter rose 27 per cent year on year in 2018 as ongoing drought conditions forced the hand of many to turn off ewes, despite record high wool and lamb prices. 

And it is still steaming ahead, with the national sheep kill last week up 23pc compared to the previous year.

Meat & Livestock Australia’s sheep projections for 2019 predict sheep slaughter to dip 16pc to 8 million because of lower flock numbers - and expect it to fall even further with widespread rain.

“With slaughter still predicted to be relatively high, and no obvious break in the season imminent, the national flock is expected to decline 3.7pc by June 2019 to 65.3m head,” the projections said.

“Looking beyond the current rainfall deficiencies, a variety of indicators point towards 2019 continuing to be a positive year for sheepmeat prices, with many producers hoping this is the case as lower lamb and sheep sales and record feed costs affect profits.

“The forecast drop in sheepmeat production in 2019 should underpin prices across both lamb and mutton throughout the year, with further upside potential if improved seasonal conditions spark increased restocker activity.”

But while industry waits for the autumn break to arrive - or not - what are producers who still have feed, or who are gambling on it to rain, paying for breeders?

Nearly 22,000 ewes were offered across two AuctionsPlus sales last week, selling from $65 to $262 a head.

The top price was for 150 scanned in lamb Border Leicester-Merino ewes, 19 to 20 months, weighing 64.5kg and September shorn from Parkes, NSW.

In comparison, the scanned empty portion of the same line sold at just $140, while 320 Border Leicester-Merino ewe hoggets, 15-17 months and 47kg from just down the road at Bedgerabong, NSW, didn't get a bid.

With conception rates so far this year being well below what many were hoping for, those with the capacity to purchase breeding stock are being very selective, and banking on getting a return sooner rather than later. 

In her AuctionsPlus weekly sheep market comments, Hannah Kermode quoted non-station mated Merino ewes averaging $126, with the top price lots (270 Merino ewes from West Wyalong, NSW, Wanganella blood, 1.5 – 2.5 years and weighing 53.4kgs) bucking the trend above and making $246.

SIL Merino ewes averaged $150 and Merino ewe lambs averaged $139.

Landmark Euroa’s David Welsh said demand remained strong for the best ewes, but secondary lines that weren’t joinable were discounted because of the season. 

“Merinos are selling particularly well, but possibly some of the better end of first-cross ewe lambs a bit flat. Again this is because of the season - there is just not the feed around to do that job,” he said

“Most in this area have sold their mutton, and are down to what they want to keep and take through. All our spring shearers and autumn lambers are set up for hopefully an autumn break and to capture that when it does. The odd person is taking a punt on the market that it is going to rain and they will capitalise on it.”

Mr Welsh said prior to Christmas there were 5 to 6 year-old sound mouth ewes going over the hooks, as the market was not paying more than kill value.

“But if it was a better season they would go back and joined to a British or terminal breed and capture the lamb market, but that isn’t going to happen,” he said.

“The ramifications on the flock across NSW will take three to four years to get over. I am hearing terrible scanning results throughout the Riverina…our finish to the season here last year wasn’t too bad, we are not as good as western Victoria but a hell of a lot better than Gippsland. We probably just haven’t gone out and bought the ewes we would usually.”