Sheepmeat value to reach $4.4 billion, ABARES forecasts

The newly released ABARES Agricultural Commodities Report further tips that saleyard prices will go up by 16 per cent to 640c/kg for trade lamb even as lamb slaughter rates and production increase slightly.

It is expected that better seasonal conditions and improved US demand as economic conditions pick up are among the factors that will help drive the gains.

According to the report, nominal sheepmeat and live sheep production values are expected to fall to $3.6 billion in 2023- 24, down by 21pc from an estimated $4.6 billion in 2022-23, reflecting the fall in saleyard prices seen last year.

It is estimated that sheepmeat exports will total $3.3 billion this financial year, down by 25pc from $4.5 billion in 2022-23, before increasing to $4.1 billion in the 2024-25 financial year.

From July prices are expected to rise due to a decreased supply of sheep for slaughter and greater saleyard demand from both restockers and processors.

Improving seasonal conditions are also expected to increase pasture availability and soil moisture levels, decreasing turn-off rates.

Sheep saleyard prices are expected to range between 254c and 335c, while lamb is expected to sell for between 592c and 690c.

ABARES estimates sheepmeat production volumes for 2023-2024 will reach 860 thousand tonnes, highlighting that increased processing of light lambs has increased processing capacity.

In 2023-24, the Australian sheep flock is expected to decline to 71.4 million head, dipping futher to 71 million head the next financial year.

Sheep slaughter rates and sheep production are expected to decline as improved seasonal conditions mean producers slow their turn-off.

Looking at the medium term, sheepmeat and live sheep production values are expected to decrease over the outlook before rising in 2028-29, ranging between $4 billion and $4.7 billion if conditions are drier but could reach as high as $5.2 billion if conditions are wetter.

Globally, world sheepmeat supply is expected to rise, driven by the growth in Australian domestic production.

It is anticipated that demand will outstrip the growth in supply from next financial onwards, helping drive up prices across the globe.

Growing demand in the United States and changing consumer preferences in emerging countries are expected to provide increasing opportunities for lamb, while China's high pork production is expected to put pressure on demand for mutton exports.

Export markets are also expected to become increasingly diversified in coming years, with increasing demand from Korea, Papua New Guinea and Malaysia.