Store and feeder lambs have been selling well above their finished counterparts in cents a kilogram terms in recent weeks.
In saleyards, restocker lamb indicators are trading at small premiums to trade lambs (Figure 1).
Online sales give a better idea of restocker demand for quality lambs.
In a recent National Lamb Sale on AuctionsPlus, second cross lambs 30-35 kilogram live weight made in excess of 900c/kg cwt, with the c/kg values falling to 800-850c/kg as lambs moved towards 40kg.
Some lots closer to 30kg made just over 1000c/kg cwt.
Buyers seemed largely happy in the $130-145 a head price range no matter the weight.
We have never seen money this good for store lambs at a time of year when there are plenty about.
Part of the reason for the strong prices is the good seasons in southern Victoria and south east SA.
There is plenty of green feed for lambs to be weaned on, and growers that destocked due to the late autumn break will be finding themselves with large excesses or grass.
Additionally, grain is about 20 per cent cheaper than it was this time last year, so lamb feeders are more interested.
The trading equation at different sell prices has gross margins looking relatively attractive.
This is true even at a lower sell price if lambs can be finished at low cost.
If lambs are being fed a full ration, the finished price will need to be close to 800c/kg to turn a profit after feed and other costs, and at 850c/kg it looks good.
What does it mean?
There is unlikely to be a better time to sell store lambs for the rest of the year, however, rain in NSW would reverse the normal trend, and see store lamb prices rally.
Looking at the forecast for this week, there is only a taste coming.
Start the day with all the big news in agriculture! Click here to sign up to receive our daily Farmonline newsletter.