Lamb prices have stabilised after some hefty corrections in the past month while exports to China, our biggest volume market, are continuing to go gangbusters.
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The benchmark eastern states trade lamb indicator rose one cent on Tuesday to 857 cents a kg after dropping 93c in the past month.
The restocker lamb indicator shed 7c to 821c but is still a whopping 275c above year-ago levels.
New-season lambs are starting to flow in the NSW market which may keep a lid on prices.
Latest export statistics confirmed China is now our biggest volume market for sheepmeat by a big margin with imports of 73,277 tonnes in the first seven months of 2019, a rise of 34pc.
So far in 2019 its lamb imports have climbed 19pc to 39,892, a rise of 19pc compared with the same period last year, while mutton imports have soared 59pc to 33,385 tonnes.
Total sheepmeat exports to the US rose 7pc to 45,711 tonnes in the calendar year to July including 35,494 tonnes of lamb (up 6pc) and 10,217 tonnes of mutton (up 9pc).
During the past 12 months China has imported 126,522 tonnes of Australian sheepmeat, a 27pc rise year-on-year. Lamb imports increased 11pc to 59,150 tonnes while mutton lifted by 46pc to 67,372 tonnes.
Over the same period the US has imported 77,510 tonnes of Australian sheepmeat, up 8pc, including 58,786 tonnes of lamb, up 2pc year-on-year, and 18,724 tonnes of mutton, up 31pc.
Australia's third biggest sheepmeat market in the past 12 months has been Malaysia (25,348 tonnes, up 5pc) followed by Qatar (23,831 tonnes, up 20pc) and South Korea (14,991 tonnes, up 2pc)
China's sheepmeat imports are being driven, in part, by a shortfall in domestic pork production caused by a nation-wide outbreak of deadly African swine fever (ASF).
The country is the world's biggest pork producer and Rabobank has estimated as many as 200 million pigs could die or be slaughtered by the end of the year.
With the bulk of Australian lamb now exported, local consumers are feeling the price pain when buying favourites like cutlets and loin chops.
And if federal Trade Minister, Simon Birmingham, gets his way more of our premium lamb will be heading into the European Union market.
This week he singled out sheepmeat as a potential major winner under current free trade agreement negotiations with the European Union.
Australia was keen to remove punitive tariffs and quotas on many of our exports to the EU market which had more than 500 million consumers.
"Take sheepmeat, for example, where Australia has a quota imposed on the amount we can send into the EU," he said.
He said our quota was now only a fraction of what NZ could ship into the high-value market.
Australia now has a 19,186-tonne combined sheep and goat meat quota (nil tariff) which represents a tiny slice of the EU's ongoing import requirements.
While lamb prices have come off the boil in recent weeks in response to record prices but Meat & Livestock Australia sees the present hot demand continuing for some time.
Lamb slaughterings increased by 8pc to 267,811 head in the eastern states last week including a whopping 147pc lift in South Australia to almost 40,000.
The NSW kill lifted by 8pc to 98,078 as new season suckers started flowing onto the market. Victoria's slaughter numbers dropped 8pc to 125,173.
The sheep slaughter across the eastern states remained unchanged overall at 94,324 largely thanks to a 650pc increase in SA's kill to 13,724.
Sheep slaughterings dropped by 18pc to 33,765 in Victoria and by 3pc to 45,685 in NSW.
