Price hike transpires as ewe lambs are retained

Price hike transpires as ewe lambs are retained

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THE high retention of crossbred ewe lambs in recent months has been labelled an "unprecedented" move by producers, according to processors that are battling to secure much-needed stock numbers.

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THE high retention of crossbred ewe lambs in recent months has been labelled an "unprecedented" move by producers, according to processors that are battling to secure much-needed stock numbers.

Since the drought broke, sheep producers have begun the onerous task of rebuilding flock numbers after heavily destocking, and Thomas Foods International national livestock manager Paul Leonard said as much as 25 per cent of this year's national first- and second-cross ewe lamb drop was being kept on-farm.

"It's something processors have not seen before. It is unprecedented. On one hand it's an opportunity to grow the national flock again but it is about to make stock procurement difficult for processors and another big player, the feedlotters," he said.

"These lambs have historically, for as long as I can remember, come to the processing sector. So between now and spring, it's going to be a challenge for those needing to secure lambs."

If Mr Leonard's ewe lamb retention figure is correct, he said it would generate "higher than anticipated" lamb prices.

Bethel feedlotter John Carter attempted to secure lambs at the SA Livestock Exchange at Dublin on Tuesday, for the fourth week in a row. But with fears of a potential substantial loss margin at the other end, Mr Carter exercised caution and was outbid.

"I am still buying lambs - normally that would not be the case. Up until the past few weeks, lamb yardings have been very small and lambs that would generally be $150 are at $170-$180," he said.

"Without a forward contract for three months' time, which at this stage are not available, there is no way of knowing if I can make the $70 a head profit margin at the end to make it viable."

Online livestock selling platforms have also seen a rise in lines of crossbred lambs being offered without the ewe portion, according to Nutrien Ag Solutions auctioneer Glenn Keast, Riverton.

"Eastern state restockers are keeping lambs and securing others, which means a kill lamb shortage," he said.

"It is definitely causing a lack of supply. It has been three weeks of large lamb yardings at Dublin, but this week is down by 5000. I do think lambs are running out."

Elders Dublin/Yorke Peninsula livestock manager Matt Ward sold lines of crossbred ewe lambs to restockers this year and believed in sheep-producing areas, this would be consistent.

"The demand for lamb has risen and it is not just from restockers. Trade and restaurants are also playing a part," he said.

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PRODUCERS CHANGE MARKET PRACTICES

A RISE in lamb prices is heavily influencing producers' marketing decisions, with some opting to change market options for the first time in many seasons.

For the past two years, Curramulka producer Ben Brind has retained lambs to grow out to hoggets for better returns, but with lamb prices steadily rising, Mr Brind sold lambs at the SA Livestock Exchange at Dublin on Tuesday for the first time this year.

"The wool prices in the past couple of years and prices for mutton meant it was better for me to retain the lambs but this year, I am selling," he said.

Mr Brind made $160 for woolly eight-month-old lambs on Tuesday and believed his choice to sell was a "good one".

"Hearing that lamb prices are reaching $260 upwards means I made the right decision to sell but I think prices are as high as it can go," he said.

The Koch family at Stockport made a return to the saleyards at Dublin this week after traditionally selling lambs over-the-hooks.

They made $260 for 106 crossbred lambs and Brian Koch said the decision to make the change was based on rising saleyard lamb prices.

"The heavy lambs were selling better at Dublin. The grid prices were not in favour but the processors are having to buy the same lambs at the saleyard anyway," he said.

"There might have to be a change of view somewhere.

"Earlier, the big scare was a lot of South East lambs coming in, so many sold early and that has not helped lamb numbers.

"We made $248 at Dublin two weeks ago, so prices are going up and down a bit but producers should be very happy."

RELATED: Heavy lamb price premiums here for foreseeable future

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