Sheep and cat­tle fore­cast

North East & Goulburn Murray Farmer - - FRONT PAGE -

AUS­TRALIA’S sheep and lamb mar­kets are pre­dicted to strengthen fur­ther with near record prices, as pro­duc­tion and slaugh­ter fore­casts dip lower for 2017.

Ac­cord­ing to Meat and Live­stock Aus­tralia’s (MLA) quar­terly sheep in­dus­try update, the mar­ket is ex­pected to re­main strong thanks to de­creas­ing na­tional num­bers.

MLA’s man­ager of mar­ket in­for­ma­tion ser­vices, Ben Thomas, said the mar­ket was be­ing in­flu­enced by a com­bi­na­tion of fac­tors - in­clud­ing strong pro­ducer in­ten­tion to flock re­build, strength of the overall wool mar­ket and low grain prices.

“Lamb slaugh­ter is ex­pected to con­tract fur­ther this year, re­vised down a fur­ther 500,000 head from orig­i­nal pre­dic­tions to 21.5 mil­lion head for 2017 and down 1.5 mil­lion head, or seven per cent, on the 2016 record,” Mr Thomas said.

“In terms of avail­abil­ity through­out the year, on the ground re­ports sug­gest a rea­son­ably strong sup­ply through to the end of April, be­fore num­bers will be­come tight un­til the new spring flush.

“Lamb pro­duc­tion is ex­pected to fall six per cent year-on-year in 2017 to 481,600 tonnes car­case weight (cwt), be­fore re­bound­ing back above the 500,000 tonnes mark in 2019.

“Sim­i­lar to lamb slaugh­ter, mut- ton pro­cess­ing is also ex­pected to con­tract fur­ther year-on-year, with a 1.2 mil­lion head, or 17 per cent, year-on-year drop to 5.8 mil­lion head for 2017.”

Mr Thomas said with 2.7 mil­lion less sheep and lambs set to be pro­cessed year-on year, the short sup­ply will keep prices buoy­ant for the re­main­der of 2017.

“The cur­rent com­bi­na­tion of fac­tors in the mar­ket will lead prices to av­er­age along­side, or even ex­ceed, the pre­vi­ous records,” Mr Thomas said.

“De­spite the buoy­ant mar­ket, there is a con­cern around the sus­tain­abil­ity of the cur­rent price lev­els fur­ther up the sup­ply chain, with some re­cent tem­po­rary clo­sures of pro­cess­ing fa­cil­i­ties.

“The risk for pro­duc­ers is once the num­ber of sheep and lambs avail­able for pro­cess­ing do re­cover, and if pro­cess­ing ca­pac­ity re­mains re­duced, there is the po­ten­tial for a greater cor­rec­tion in prices than oth­er­wise would have been the case.”

Mr Thomas said pro­duc­ers could be cau­tiously op­ti­mistic about prices be­yond 2017.

MLA pro­vides a range of mar­ket in­for­ma­tion ser­vices in­clud­ing daily red meat mar­ket news up­dates, de­tailed mar­ket anal­y­sis, re­gional sa­le­yard re­ports, live ex­port in­for­ma­tion and price in­di­ca­tors.

PHOTO: abc.net.au

STRONG PRICES: Meat and Live­stock As­so­ci­a­tion man­ager of mar­ket in­for­ma­tion ser­vices, Ben Thomas, has fore­cast that with 2.7 mil­lion less sheep and lambs set to be pro­cessed year-on-year, the short sup­ply will keep prices buoy­ant for the re­main­der of 2017.

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