Lamb slaughter down as producers rebuild flocks

By Country News

A recovery in the national sheep flock is under way, with producers in key regions in a position to consider increasing flock numbers.

According to Meat & Livestock Australia’s 2020 Sheep Industry Projections June update, the shift is due to improved seasonal conditions.

However, despite predicted above-average rainfall between June and September for most of Australia, the impact of consecutive drought years will affect overall sheep and lamb supply in 2020.

MLA senior market analyst Adam Cheetham said as producers looked to rebuild flocks and ewe lambs were retained, lamb slaughter was anticipated to decline to 20.6 million head — back five per cent on 2019 levels.

“Similar to 2018 and 2019, supply is expected to be particularly tight during the winter months, given the depleted breeding ewe flock and fewer lambs on the ground,” Mr Cheetham said.

“Lamb carcase weights are forecast to increase 0.6 kg/head on 2019 levels to 23.9 kg/head, assisted by improved feed availability, a greater number of lambs in lot feeding programs and strong price incentives to finish lambs to heavier weights.”

Mr Cheetham said increasing weights would not offset the fall in slaughter.

“As a result, lamb production in 2020 is forecast to decline two per cent year-on-year, to 492 000 tonnes carcase weight,” he said.

“Following back-to-back years of excessive turn-off, sheep slaughter is forecast to decline by 30 per cent to 6.5 million head in 2020.

“Underpinned by the substantial decline in sheep slaughter, mutton production is forecast to fall sharply to 161 000 tonnes cwt, back 29 per cent year-on-year.”

Export forecasts for the year will be lower, due to the softening global economy and tightening domestic supply.

“Lamb exports in 2020 are forecast to reach 282 000 tonnes shipped weight, down one per cent on 2019 volumes, while mutton exports are forecast to decline 31 per cent to 129 000 tonnes swt,” Mr Cheetham said.

Mr Cheetman said growing retail demand, a soft Australian dollar and the African swine fever-induced protein deficit would continue to drive export prices for sheep meat.

To read MLA’s 2020 Sheep Industry Projections June update, visit the Prices and Markets section of MLA’s website.