AUSTRALIAN lamb imports at higher prices are benefiting from a sustained decline in the American sheep industry, Meat & Livestock Australia has reported.

Steiner Consulting’s latest US market update released by MLA said prices for imported lamb continue to hold very firm despite the notable increase in the volume of imported Australian and New Zealand lamb available.

The average price of fresh chilled Australian racks is currently running about 10-15 percent above a year ago depending on size, the update said.

Prices for frozen New Zealand lamb racks are up 10-14pc as well. Prices for other cuts are also up, but in the single digits. The only exception has been the price of fresh Australian lamb shortloins, which is currently 9pc lower than a year ago, Steiner Consulting said.

The Steiner report said while Australian mutton exports to the US were down 20pc in January, they increased recently and February shipments to the US were up about 20pc compared to a year ago. Higher sheep slaughter in Australia has bolstered the export pace to all destinations, including the US, Steiner Consulting said.

MLA said lamb imports from Australia and New Zealand have continued at high volumes in 2019, benefiting from high US prices and a strong US dollar. For the year so far (through 2 March), Australian lamb imports totalled 12,041 tonnes shipped weight, up 21pc on the previous year.

USDA data points to declining US lamb turn-off

MLA said recent United States Department of Agriculture data showed a continued downward trend in the US sheep industry, with the American flock estimated to be 5.23 million head on 1 January 2019. This is 0.7pc lower than the previous year and the lowest total on record.

The estimated number of replacement lambs also fell, underpinning the expectation for further contraction again in 2019, MLA said.

The 2018 US lamb crop was estimated at 3.2 million head, which was a slight gain on the previous year due to an improvement in weaning rates. In 2019, growth in the lamb crop is not expected given the decline in breeding numbers.

However, with producers retaining fewer lambs for breeder replacements, more stock is available for market. The total inventory of market lambs at the start of 2019 was 1.3 million head, 0.6pc higher year-on-year.

Click here to read the latest US monthly market update prepared by Steiner Consulting.

Source: MLA.