LAMB prices in WA have hit $100 for the first time this year as processors begin to run short of product.
A line of 68 Suffolk and Texel cross lambs peaked at $102 at Katanning last week, with some members of the industry estimating the price was the equivalent to an extraordinary $4.60 per kilogram dressed weight, significantly higher than lamb prices in saleyards across the country last week.
The lambs were offered by Dumbleyung farmers Michael and Jane Smith and sold through Landmark.
Heavy crossbred lambs rose $15-$20 on a strong market while trade lambs also rose $15-$20 to top at $94.
Processors say while they may be forced to pay higher prices because of the shortfall in lamb supply, they have warned producers they will be influenced by consumer spending.
They say the market will not be able to sustain prices at those levels because of the continuing high level of the Australian dollar impacting on export orders.
Hillside Meats proprietor Polly Trefort warned producers not to expect prices to stay at that level.
³There were a few processors caught short last week and orders had to be filled and that pushed the price up,² Mr Trefort said.
Because of the high Australian dollar, processors supplying the export market could not afford to pay those prices.
³At the moment with the dollar where it is, we are looking at about $75-$80 to make the figures work,² Mr Trefort said.
³Anything over that price isn¹t viable.²
Mr Trefort said he understood the price was probably where it should be for producers because of the increasing input costs, but processors were being driven by what the consumer would pay.
³It is a difficult situation at the moment because the high dollar combined with the shortage of lambs is making it difficult on processors,² he said.
³A lower dollar would ease the pain on processors and we would be able to pay a bit more for lambs.²
WAMMCO chief executive Des Grif-fiths predicted prices would sit at higher levels for some time.
³Prices for good lambs will hold up because they are in short supply at the moment,² Mr Griffiths said.
³The $102 in Katanning was the result of a couple of processors locking horns and driving the price up, but, due to supply shortages, prices will be high for quite some time.²
Mr Griffiths said nobody really knew what numbers of marketable lambs were available.
³There are certainly still lambs on feed and prices such as these will bring them out into the market,² he said.
³There would not be large numbers on feed though and so supply will probably dry up more.²
Mr Griffiths said the current prices were not economical to processors but they would be forced to pay them.
³There are markets to maintain and a workforce to keep employed and it is just a matter of riding out the negative returns for the good times,² he said.