W27: Mutton & Lamb Update

Published Jul 11, 2023
W27: Mutton & Lamb Update

In W27 in the lamb and mutton landscape, the Food Agriculture Organization (FAO) reports that the meat price index stood at 117.9 points in Jun-23, unchanged from May-23 but down 6.4% YoY, with lamb prices falling amid strong supply in Oceania. Tridge’s analysis indicates that the celebration of Eid al-Adha on June 28 led to an increase in meat prices in various countries across the Middle East North Africa (MENA) region, and South Asia. In Egypt, meat prices soared, with the average lamb price increasing to USD 291.28, up 28.6% YoY. Similarly, mutton prices rose from USD 5.83/kg in 2022 to USD 12.30/kg, up 110.9% YoY. The cost of animal feed and rising demand contributed to the price surge. In Tunisia, sheep prices registered significant variation, ranging from USD 161 for a small ewe to over USD 646 for a large ram, with an average sheep price of approximately USD 291, an increase of 25% YoY. The United Arab Emirates (UAE) also experienced a significant increase in livestock prices, with the popular Al Nuaimi sheep selling for USD 408.37/head. Tridge expects a decline in meat prices in Egypt and the UAE in Jul-23, as demand subsides, but prices are anticipated to recover in Aug-23.

Recent rainfall experienced in Australia had a significant impact on the Australian sheep market dynamics, leading to improved prices across various categories, following challenging selling conditions in previous weeks. Light and restocker lamb prices emerged as the top performers in W27, increasing by USD 0.37/kg carcass weight (cwt) WoW. This recovery in prices indicates a demand for lamb for trading purposes, driven by favorable Jun-23 rainfall and ample pasture availability along with abundant on-farm grain storage. Mutton, on the other hand, had a more modest performance, but still experienced a USD 0.10 increase WoW, reaching USD 2.21/kg cwt by the end of W27. Merinos remained the dominant ewe breed in Australia, representing 62% of the total yarding in the Mutton indicator. National lamb slaughter reached its second-highest volume since May-19, with 437,749 heads, closely trailing the volume recorded in the last week of May-23. Victorian lamb slaughter volumes reached their highest levels in over five years, dating back to Jun-18. National mutton slaughter currently exceeds the levels seen in the corresponding weeks of 2022 and 2021. Meat and Livestock Australia (MLA) expects a strong increase in Australian mutton slaughter from late Jul-23 onwards. In Jun-23, Australian sheep meat exports increased by 32% YoY, as lamb shipments reached 28.65 thousand mt, up 15% YoY, the highest monthly exports since 2019, while mutton exports totaled 17.76 thousand mt, an increase of 74% YoY. The growth in exports was particularly pronounced to China and the MENA region, with YoY increases of 92% and 86%, respectively. Notably, Australian mutton exports to China rose by 165% YoY, reaching 8.76 thousand mt, accounting for nearly half of the total exports. The first month of the Australia-United Kingdom Free Trade Agreement, Jun-23, saw a sharp rise in exports to the United Kingdom (UK), although starting from a low base. Lamb exports rose by 102% to 687 mt, while mutton exports surged by 679% to 488 mt.

Lastly, during W26 in Ireland, approximately 62 thousand sheep were slaughtered, a decrease of nearly 8 thousand heads WoW. This period coincided with Eid al Adha, which typically sees a surge in lamb demand. However, 2023's festival took place a week earlier than in 2022. The pre-Eid sheep kill in 2022 reached approximately 78.5 thousand heads, the highest 2022 weekly sheep kill. In contrast, 2023's pre-Eid kill totaled 70 thousand heads, the largest weekly sheep kill so far in 2023 but smaller than 2022's. While the supply of Irish hoggets decreased, it remained significantly higher than in the same period in 2022. In the last week of Jun-23, 5.35 thousand hoggets were processed, up compared to 1.6 thousand heads in the same week of 2022. The cumulative hogget kills in 2023 reached 970.5 thousand, surpassing 2022’s hogget kills by over 80 thousand heads. This increase is attributed to the higher carryover of the 2022 lamb crop. The total number of Irish sheep slaughtered in 2023 is 49 thousand heads higher than in 2022, with the cumulative hogget kill leading by 80.39 thousand heads, while the cumulative spring lamb kill is 26 thousand heads, lower than 2022's volume.

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