As we approach two years since drought breaking rains swept across much of the eastern seaboard in March 2020, which ignited a restocking crusade, lamb prices rose to new highs in 2021. As record high volumes of new season lambs hit the market during the final quarter of 2021, prices showed the first signs of responding to increased supply, as a price shift became evident during the closing months of 2021.
Quarterly lamb category prices (as seen in Figure 1) highlight overall positive price trends for 2021 compared to 2020, with the current price position of the lamb market sitting well above the ten-year average - underpinning the confidence in the lamb market for both the short and medium term ahead. Despite the $/head prices remaining at historically high levels, the rate of price increases has flattened significantly across the calendar year, with several category averages beginning to ease back at the close of 2021, as high volumes of lambs entered the market following an excellent lambing season. When compared to the Eastern States Trade Lamb Indicator (ESTLI), AuctionsPlus lamb prices have followed a similar trajectory - particularly as flock numbers increase to support a rise in numbers across both slaughter and export sectors.
Across 2021, all six lamb categories returned higher year-on-year averages on a dollars per head basis compared to 2020. Shedding breed lambs recorded the largest rise, as prices increased by 23%, with the rapidly growing throughput, totalling 149,793 head for the calendar year, an increase of 38% from 2020. This was also the only lamb category to record a price rise between the third and fourth quarters of 2021, finishing the year at an impressive high of $302/head. Contrary to the markedly significant rises noted for shedding breed lambs, Composite/other breed and Merino ewe lambs had the largest price decline between the third and fourth quarters of 2021, with both categories decreasing by $60/head. They were also the only two lamb categories to record negative year-on-year changes from 2020 (see table 1).
Total AuctionsPlus lamb listings for 2021 reached 2.67 million head, a 9% rise from 2020. The final quarter for 2021 had a total of 987,530 head of lambs offered online - the highest offering on record with an increase of 47% from the previous quarter and a 6% rise from the same quarter in 2020 (see table 2). The final three months of 2021 saw crossbred and Composite/other breed lamb categories return their highest ever throughput numbers on AuctionsPlus, offering 479,296 head and 92,084 head, respectively. Crossbred lamb numbers rose by 93% between the third and fourth quarters of 2021, while Composite/other breed lambs rose by an astounding 288% - signalling the growing intentions of producers joining ewes to terminal sires and placing increased focus on a meat-breed or dual-purpose enterprises.
To further this notion, a notable year-on-year decline in both Merino ewe and wether lamb listings was registered, with the categories’ throughputs decreasing by 13% and 2% from 2020, respectively. Indeed, a decline in Merino ewe lamb numbers could be indicative of producers retaining new season lambs to join in coming months. However, lower clearance rates coupled with both year-on-year and quarterly price declines for the category suggest a subtle shift in both producer and restocker intentions regarding ‘traditional’ Merino enterprises.
First cross ewe lambs recorded a total of 327,974 head listed on AuctionsPlus in 2021 - a 13% year-on-year rise from 2020. Despite higher overall listings, the year-on-year quarterly change for the category declined 8% - attributed to the excellent seasonal conditions allowing producers to retain new season lambs for joining to increase their respective flock size. Prices for first cross ewes averaged $255/head across the year – a $23 rise from 2020, despite prices slipping by $29/head in the final quarter of 2021.