In 2023, the Australian sheep industry experienced notable trends in both the lamb market and hogget supply. The national sheep flock reached its largest size since 2007, with 28.75 million head, driven by high numbers of breeding ewes and strong marking rates.
Throughout the year, lamb prices showed significant fluctuations. After a decrease over eight months, prices began recovering from October. The restocker lamb indicator notably fell by 62% until September, then surged by 158%.
This pattern of volatility was evident across all market indicators. By January, lamb yardings were on track to be the highest since 2019, reflecting a shift in market confidence likely spurred by record rainfall and improved producer sentiment. Prices nearly returned to their January 2023 levels, with current prices up nearly 20% from December 2023.
In the current market, heavy and trade lamb indicators are strong, hovering around 700c/kg cwt, which is 63% higher than mutton. This significant price difference has led producers to reconsider their strategies when lambs age out of the lamb market.
The high supply of lambs has also impacted the hogget market. Producers faced pressure to provide quality, finished animals to remain competitive. If unable to meet these standards, there was a risk of lambs missing their market window (under 12 months and without permanent teeth wear), potentially leading to increased retention of lambs and higher numbers of hoggets seeking a market.
For producers with hoggets, options were limited: either sell into the mutton market at a lower price or retain stock, potentially straining land capacity. In 2023, hoggets fetched, on average, a 33% premium over mutton in sale yards, though this varied significantly.
As of 2024, hogget prices have started strong, averaging an 86% premium over mutton through sale yards. Despite high overall sheep throughput this year, the proportion of hogget yardings has decreased from 13% last month to 10% this year to date.
This overview of the lamb and hogget markets in 2023-2024 provides insight into the dynamic nature of the Australian sheep industry, highlighting the challenges and opportunities faced by producers in a fluctuating market environment.
