With lambing finished or underway in many areas, farmers are willing to shell out on top grain to keep their ewes and lambs ticking along in the dry. Forward sales of lamb is averaging $6 to $6.50/kg.

“Lamb is looking very very healthy,” Landmark Harcourt’s Wagga Wagga livestock manager Peter Cabot said. “It’s got to be as good as it’s ever been.”

Wagga Wagga saleyards have seen exceptionally strong numbers for sheep and lambs this autumn, with 45,000 sheep and lambs yarded so far. Also sheep and lamb prices moved forward at Forbes’ sales this week and have remained solid despite the tough conditions..

“Judging by what I’ve seen there is going to be tight supply in spring,” Mr Cabot said. “Producers have been keeping up their sheep numbers in the dry while they are more inclined to unload their cattle. People seem confident to feed their sheep through the dry.”

He said though the tough conditions would affect weights. There would be very few early suckers on the market.

Jarrod Amery, “Lone Pine” and “Velu”, has been spending nearly $5000 a week on feed for his 4000 ewes. He has been paying $330 a tonne for barley, with feed for his 3200 merinos costing about $1.20 a head a week to feed, and his 800 crossbred ewes, that lambed about six weeks ago, costing about $2 a head for feed.

He achieved 130 per cent lambing rates on “Velu”, about 26km south of Forbes. His oldest lambs are about seven weeks. He will wean his lambs early to help reduce the feed bill. “Prime lamb prices are looking pretty good for spring, so we are hoping on that. You expect good and bad seasons, and you get early breaks and late breaks, it’s all part of farming.” He only received about 10mm in the latest rain event. He also has planted 400ha of monola, for which he’ll get a premium for a higher quality oil, by selling through MSM Milling.

Strong demand from overseas has also bolstered the lamb sector. Australian lamb exports hit 22,581 tonnes shipped weight (swt) in April, up 32 per cent year-on-year. 

Scott Tolmie, Meat and Livestock Australia manager of Market Intelligence, said in a release for The Land that “deteriorating pasture conditions across many of the key sheep supply regions of the south east has seen larger numbers of stock than anticipated turned off so far in 2018”.

“Ongoing dry conditions have limited the ability of many producers to expand flocks despite both sheepmeat and wool prices remaining near historical highs,” Mr Tolmie said.

“Encouragingly, industry survey results suggest that producers maintain the intent to retain or expand ewe flocks where they can,” he said.

“Whether this intent follows through depends on how the season plays out. If a decent break in the season does eventuate, we should see tighter supply later this year, especially sheep. Many producers are relying heavily on supplementary feeding leading to carcase weights holding up well for the first few months of 2018.

“Poor summer rainfall across many key supply regions has been reflected in the Eastern States Trade Lamb Indicator (ESTLI) movements so far in 2018. After tracking well above year-ago levels since October 2017, the ESTLI has moved below year-ago levels since February. The Indicator dropped from close to 650¢/kg cwt throughout January down to below 600c/kg cwt in mid-April – the lowest levels since October 2017. However, with slaughter levels well up on the same time last year, the performance of the ESTLI and mutton indicator has been quite solid.

“Lamb exports are up 9 per cent for the year-to-April, with the growth seen across the Middle East, Greater China and Japan. Reflecting this strong demand the value of lamb exports for the January to March period (latest available ABS data) was close to A$532 million, up 9 per cent year-on-year, with the average unit value lifting 8 per cent to $8/kg. It has been a similar story in mutton with exports 14 per cent higher than year-ago levels. The trade for the January to March period (latest available ABS data) returned A$252 million, an increase of 20 per cent year-on-year. The average mutton export unit value lifted 5 per cent, to average $5.73/kg. Overall the outlook for sheepmeat exports for 2018 remains positive due to growth in import demand in China and subdued competition from New Zealand. However, much still depends on key sheep regions receiving decent rainfall, the Australian dollar remaining competitive, no significant upward changes to New Zealand production and China's own domestic sheepmeat production.”