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Australian Sheep Industry Overview December 2013 MLA’s Market Information Service 02 9463 9163

Key market drivers  Most sheep growing regions in November were dry,

with large swathes of NSW, Victoria, SA and WA recording ‘below average’ rainfall. In contrast, coastal regions of the easter n states, eastern WA and Tasmania received ‘above average’ rainfall.

Figure 1

Australian rainfall analysis November 2013

 National lamb yardings at MLA’s NLRS reported

saleyards during November were up 1% year-on-year, with an increase in light lamb throughput (up 13% to 282,558 head), slightly offset by marginal decreases in all other categories. Trade lamb (-4%), heavy lamb (-4%) and extra heavy lamb (-26%) yardings totalled 240,775, 155,235 and 17,949 head, respectively.  In November, prices for all lamb categories were up

when compared to the previous year, with the price of restockers, Merinos and light lambs up 51¢, 57¢ and 45¢, to average 384¢/kg cwt, 319¢/kg cwt and 361¢/ kg cwt, respectively. The national trade lamb price in November averaged 398¢/kg cwt, up 76¢ year-on-year, while heavy lambs gained 77¢, to average 408¢/kg cwt.

Legend Highest on record Very much above average Above average Average Below average Very much below average Lowest on record Source: Bureau of Meteorology

 Over-The-Hooks prices ranged from 394¢/kg cwt for light lambs (up 48¢ year-on-year), to 410¢/kg cwt

for medium trade and heavy trade lambs (up 52¢ and 51¢ year-on-year, respectively). Meanwhile, heavy lambs averaged, 409¢/kg cwt, up 52¢ on November last year.  Total lamb exports in November reached a monthly record of 19,792 tonnes swt, up 6% on the corresponding

month last year. Underpinning the growth were large year-on-year increases in shipments to China (3,976 tonnes swt) and Hong Kong (1,283 tonnes swt), up 20% and eight fold, respectively. While shipments to the US in November remained steady year-on-year at 3,358 tonnes swt, exports to the Middle East and the EU eased 3% and 35% year-on-year, respectively, to 5,154 and 1,005 tonnes swt.  The national saleyard mutton price averaged 201¢/kg cwt in November, up 46¢ on the corresponding

month last year. Total mutton exports reached 17,181 tonnes swt – up 24% year-on-year, led by a more than two-fold increase to China (7,075 tonnes swt), while shipments to South East Asia were up 43% year-on-year, to 2,066 tonnes swt. In contrast, exports to the Middle East were back 47%, at 2,959 tonnes swt. Jonathan Meggison – Sheepmeat analyst (02) 9463 9310 MLA Market Information

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Australian Sheep Industry Overview

Decmber 2013

Key lamb and sheep statistics Table 1 Lamb and sheep statistical summary

Calendar year comparisons to November Nov-13

Livestock indicator prices (¢/kg cwt) Restocker/feeder lamb (0-18kg) Merino lamb (16-22kg) Light lamb (12-18kg) Trade lamb (18-22kg) Heavy lamb (22+kg)

% change Sep-13

% change Oct-12

2013

2012

% change

Oct-13

Nov-12

333 262 316 321 331

384 319 361 398 408 201

0% 3% 2% 0% 0%

15% 22% 14% 24% 23%

363 342 364 417 435

420 362 405 420 406

-14% -6% -10% -1% 7%

-1%

30%

199

253

-21%

385 309 355 399 408 204

Mutton Exchange rates A$/US$ Average weekly eastern states slaughter* Lamb Sheep Australian lamb exports (tonnes swt)

0.93

-2%

-11%

0.98

1.03

-5%

0.95

1.04

370,627 174,340 19,792

-2% 10% -5%

2% 35% 6%

345,422 143,893 193,510

326,531 86,623 172,166

6% 66% 12%

376,743 158,012 20,825

364,774 128,997 18,725

Middle East USA Greater China** EU Papua New Guinea Australian mutton exports (tonnes swt)

5,154 3,358 5,479 1,005 940 17,181

1% -20% 11% -38% -3% -5%

-3% -1% 50% -35% -22% 24%

54,923 35,529 43,914 10,011 11,577 153,491

47,199 33,672 31,103 10,831 12,335 93,065

16% 6% 41% -8% -6% 65%

5,113 4,206 4,948 1,625 970 18,006

5,288 3,391 3,652 1,546 1,199 13,835

Greater China** 9,308 5% 139% 61,821 Middle East 2,959 14% -47% 37,461 South East Asia*** 2,066 4% 43% 19,989 USA 557 -22% -3% 8,132 Source: DAFF, MLA's NLRS, RBA *Eastern states includes NSW, Queensland, SA, Tasmania and Victoria **China, Hong Kong and Taiwan, ***Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam

16,876 42,457 10,394 6,919

266% -12% 92% 18%

8,904 2,593 1,996 712

3,901 5,541 1,443 574

Calendar year comparisons to October

Table 2 Australian live sheep exports (head) Oct-13

% change Aug-13

% change Oct-12

2013

2012

% change

Sep-13

Oct-12

Kuwait

72,593

20%

-8%

679,496

570,653

19%

60,737

78,969

Qatar

60,000

20%

0%

477,865

417,472

14%

50,000

0

3,717

-13%

71%

23,466

12,448

89%

4,258

2,171

17,260

-68%

-78%

287,792

327,960

-12%

53,598

77,000

7,000 3,833

-70% -84%

0% -78%

89,795 103,890

26,211 599,281

243% -83%

23,000 23,645

0 17,665

164,403

-24%

-6%

1,662,304

1,954,025

-15%

215,238

175,805

Malaysia Jordan UAE Other Total Source: ABS

Table 3 Annual and quarterly forecasts Australian lamb slaughter ('000 head) Australian mutton slaughter ('000 head) Australian lamb exports ('000 tonnes cwt) Australian mutton exports ('000 tonnes cwt) Australian live exports ('000 head) US lamb and mutton imports ('000 tonnes cwt)

2012

Q1

Q2

Q3

Q4

2013

2014

20,009 6,064 222 134 2,280 69

5,328 2,477 56 49 506 22

5,401 2,194 62 42 549 19

5,370 2,141 61 43 510 17

5,030 2,638 64 55 460 19

21,600 9,450 243 189 2,000 77

20,150 6,300 233 134 2,200 74

Source: USDA, DAFF, ABS, MLA Forecasts

italics indicate forecasts

Figure 2

Figure 3

National average November saleyard lamb prices

Australian lamb exports

500

155

'000 tonnes swt

A¢/kg cwt 5-yr average (2008-2012)

2012

2013

20

US

Middle East

EU

Greater China

Other

15

400

10 300

5 200 0-18kg restocker/feeder

16-22kg Merino

Source: MLA's NLRS

12-18kg light

18-22kg trade

carcase weight

22kg+ heavy

0 N D J F M A M J J A S O N D J F M A M J J A S O N 2012 2013 Source: DAFF

© Meat & Livestock Australia, 2013. ABN 39 081 678 364. MLA makes no representations as to the accuracy of any information or advice contained in this publication and excludes all liability, whether in contract, tort (including negligence or breach of statutory duty) or otherwise as a result of reliance by any person on such information or advice. Free to MLA members For further information please call toll free 1800 023 100 or 02 9463 9163 or fax 02 9954 0752 Also available on www.mla.com.au

MLA Market Information

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Mla sheep industry overview december 2013