A leading sheep and lamb producer believes the recent price drop on lamb by Woolworths supermarkets will be a good thing for the industry by encouraging consumers to “put more lamb in the trolley” after years of high prices.
A pen of lambs ready for trucking at Schulz Livestock. Pic: Jason Schulz
Jason Schulz of Schulz Livestock, who runs 2000 breeding ewes producing 2500 lambs at Coonalpyn SA, said that at certain points in the cycle beef and lamb had “priced themselves out of the market”.
“Particularly with interest rates where they are and householders worrying about their budgets, it has made chicken look like a good option,” he said. “Hopefully this price drop will see people go back to eating lamb once a week.”
On Monday, Woolworths said would reduce the price of 26 Australian lamb products by 20%, including dropping the price of lamb leg roast from $10 per kilo to $8/kg. It is the lowest price on lamb legs since February 2017 and lowest regular price on lamb since June 2013.
The retailer expects to sell 1.7 million kilos of lamb leg roast this Christmas season.
Mr Schulz said that he expected other retailers to match the price drop and hoped that the increased consumer demand would help reduce the current stockpile of red meat.
He said he still had a high confidence in the industry and said that the recent “panic selling” had meant that a lot of farmers had been sending massive numbers of ewes to slaughter.
The impact of that "panic selling" was affirmed by recent comments by Endeavour Meats CEO Anthony Pratt, who recently told a Farm Writers' Association audience that the biggest factor driving prices was the sheer lack of processing capacity.
"That lamb is worth what a processor is prepared to pay for it, regardless of what the meat price is. So if a processor needs 10,000 lambs that week and he's got 10,000, and another 5,000 is getting offered to him. Guess what the price is next week?" Mr Pratt said.
READ MORE: Endeavour Meats CEO sees uplift in beef prices within six months
Mr Schulz, who is also chair of the biennial LambEx industry convention, to be hosted in Adelaide next year, said that he was disappointed that so many producers had been offloading breeding stock but it would make the upswing in prices that much higher.
“There’s no real reason for sheep to be maintaining this low price point,” he said. “There has been a lot of panic selling which means there will be a lower ewe base going forward. That will force prices to tick up again.
I’ve been stocking at my highest rate as I see it as a really good buying opportunity. It will come good for those who hold their nerve and stay in it.”
Mr Schulz said that the future for the industry was still bright.
“The world wants our lamb and mutton,” he said.
That optimism was shining through in the number of submissions to the LambEx carcase competition, with 1800 lambs across 15 different breeds to arrive at Thornby Feedlot in South Australia on 1 December 2023.
“We’ve seen a really pleasing cross section of entries across Australia including South Australia, New South Wales, Victoria & Western Australia. Entries were actually closed off two weeks early such was the demand,” he said.
READ MORE: LambEx carcase competition hits full stride
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