Bumper lambing likely with plenty of demand

Bumper lambing likely with plenty of demand

Wool
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Scanning results in northern Victoria, the Western District and Gippsland have delighted farmers and testers alike.

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LAMB DELIGHT: Scanning rates are up and demand for lamb looks solid, too.

LAMB DELIGHT: Scanning rates are up and demand for lamb looks solid, too.

A bumper lambing might be just around the corner and there's likely to be plenty of demand.

Scanning results in northern Victoria, the Western District and Gippsland have delighted farmers and testers alike.

Scotts Pregnancy Scanning's Joe Scott said farmers were feeling much more positive.

"Our clients have had a good break and the sheep are in a lot better condition and they're getting results," Mr Scott said.

"The results on average are 10-15 per cent better than other years in terms of twinning rate and the wet-dry rates are 5-10pc better.

"All the February through to March scannings from the river up into NSW for Merinos were up to 20pc better than the last two or three seasons.

"The Merinos were topping 155-160pc, that's right up there."

Rates for crossbreds and composites had also lifted.

"We started doing composites in March, April and they were getting really high results, around 160-175, which is 15 to 20pc better for them, too," Mr Scott said.

Two weeks ago, Scotts Pregnancy Scanning travelled to the Western District around Hamilton, Warrnambool, Penshurst and Macarthur.

"The results down here have been unbelievable," Mr Scott said.

"Out of the 40,000 sheep we scanned, we probably averaged 4-5pc empty over 15 different farmers.

"They don't have a wool market down here - it's all composite ewes - they have a lot more emphasis on fertility because they need a 3-5pc to be viable.

"An empty down here is pointless for 12 months, they have to be sold.

"Up north, they get $80-140 worth of fleece off the Merinos, so they can justify 10-15pc empties."

Mr Scott said some of the boom could be explained by the early autumn break.

"We're probably a month in front of ourselves," he said.

"Their optimum joining period is March/April but because of the seasonal break, the sheep have been cycling a month earlier, so we're seeing the results earlier.

"A client we normally get 140pc in Feb every year, he got 145-150pc, which is what you'd normally get a month later.

"They're trying to pull them forward a month earlier so they can get sucker lambs on them before Christmas.

"A lot of people have had sheep in feedlots, particularly up in southern NSW, and that's helped get a higher percentage of ewes pregnant because the rams have only had to cover a small area and now that it's rained, people have been able to get the ewes out in the paddock onto grass.

"It's going to be interesting to see the lambing rate."

Jo McKinley has been working across central and east Gippsland.

"We're seeing great results, even with maiden Merinos, which I've seen going as low as 5pc dry," she said.

"Merino maidens probably averaged 10-15pc, mature ewes were consistently under 10pc and down to just a few per cent dry.

Twinning rates in crossbreds, she said, were "huge".

"Even the early joining prior to any rain we've had have been good - they've had to feed sheep right through and they've been coming in in great condition and it's paid off."

J&C Stockscan contract scanner Jamie Parfett, Brimpaen, who works in a 300-kilometre radius of Warracknabeal, said dry rates were up to 70pc lower.

Rodwells Horsham agent, Dale Dridan said clients had reported twinning rates were up, perhaps by 20pc, and there was solid demand from restockers.

"There's a lot of demand coming out NSW and northern and central Victoria," Mr Dridan said.

"We're seeing a lot of inquiry for stock to go north.

"Locally, demand is no better or worse than in other years."

"Sourcing and securing good lines of breeding ewes will be very, very hard and costly, too."

Low numbers likely to support good prices

Limited sheep numbers will support Australian farmgate lamb prices but Rabobank forecasts for the wool sector remain less bullish.

Rabobank senior animal proteins analyst Angus Gidley-Baird said weak Australian sheep numbers would counter the impact of volatile global markets and the coronavirus chaos.

The low Australian slaughter rate, which was 12 per cent down year to date for lamb and 26pc for sheep, was indicative of producers holding and rebuilding flocks now that the season had turned.

Mr Gidley-Baird said the "phenomenal" increases in lamb prices experienced earlier in the year - 35pc higher year on year - were likely to soften.

While Australia would be somewhat protected by its strong domestic sheep market, 65pc of lamb, and almost all mutton and wool, were exported.

"A large bulk of Australia's product into the Chinese and US markets - 60 to 65pc - is eaten out of home, with Australian lamb sold into the US heavily focused on the higher-end restaurant market, making it particularly vulnerable to the global economic slowdown," Mr Gidley-Baird said.

Foodservice traffic in China during February was down 80pc, although there were signs of recovery.

Demand from consumers stripping supermarket aisles had fuelled prices in late March but that had now dissipated.

Mr Gidley-Baird expected heavy lamb and mutton prices would behave similarly to last year, coming off their early highs before picking up again in May, June and July.

"Given our supply situation, I don't expect prices to drop dramatically, unless we were in the very unfortunate situation where multiple processing facilities ended up closing due to reduced margins or a COVID-19 outbreak - reducing processing capacity on market," he said.

Australian wool prices would likely fall on the back of weaker demand, before recovering in late 2020.

The forecast assumed decreased US and Chinese consumer sentiment plus severe economic contraction over the next six months, before a late 2020 into early 2021 improvement.

It was also based on an anticipated fall in cotton prices followed by a recovery, and a drop in Australian wool production of 2-3pc.

"Interestingly, last year China had one of the lowest volumes of wool imports in the past 10 years, so we expect stocks in China to be relatively low, driving stronger imports as factories start to open up again," Mr Gidley-Baird said.

Wool prices were expected to continue to ease towards 1100cAUD/kg through to the middle of the year before picking up towards 1400cAUD/kg in late 2020/21 as economic conditions improved.

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