Trends in the mutton market

Lamb prices increased on the back of higher demand and lower supplies towards the end of April, according to AMT.

Slaughter prices also increased significantly due to higher demand and lower supply towards the slaughter market. We can expect these prices to increase as demand is likely to increase and supply to decrease as well.

Price movements

·       Lambs – The price was 3.46% higher compared to the previous month, 8.32% higher than two months ago and 8.08% higher than last year the same time. Based on historic trends, the price can trend upward over the coming month.

·       A2/3 – The price was 11.26% higher compared to the previous month, 11.38% higher than two months ago and 11.64% higher than last year the same time. Based on historic trends, the price can trend upward over the coming month.

The increase in the lamb price during April combined with a strong increase in the A2/A3 carcass price resulted in the lamb : carcass price ratio to decrease to 0.47; which is lower than the long term average ratio of 0.48. The higher yellow maize price in combination with higher A2/A3 carcass prices resulted in a maize to carcass price ratio of 21.89.

The lamb price is expressed in carcass (A2/A3) equivalent given a 48% dressing percentage. Lamb prices increased while carcass prices increased significantly during the past month moving above lamb prices. An expected increase in the A2/3 carcass prices combined with a possible increase in the lamb price during the short term will result in the margin between the respective prices to stay similar. Lamb prices (relative to carcass prices) are trading on a similar level than the A2/3 carcass price, this gap is expected to stay close over the short term.

Aggregate commercial slaughter numbers increased by only 0.06 index points during April but is still well below last year’s levels. Slaughter numbers are expected to decrease in the following three months, most likely keeping prices on a higher level.  

Skin prices increased over the past month and recovered well from relatively low levels over the past two years.

The latest dorper and merino skin prices traded on R53.15/skin and R72.77/skin respectively.