Vendors keep a close eye on forward contracts

Tim Francis

Tim Francis

VENDORS are weighing up whether the lure of attractive forward contracts for lambs will be as good as the auction system.

New information released by Mercado shows that forward contracts for lambs could reach 630c/kg by January 2018.

People who have purchased lambs would be looking at those contracts and considering a price they want to get.

Tim Francis

This is a figure lamb producers have been keeping a close eye on.

Tim Francis of H Francis and Co in Wagga says returns could in fact go higher than 630c/kg for lambs in January given the overall demand. 

“People who have purchased lambs would be looking at those contracts and considering a price they want to get,” he said. 

The forward contract offers for five weeks in January range from 580c/kg cwt for an 18-32 kg grid, through to 630c for an 18-24 kg grid. 

Historically, this is very good money. 

The Eastern States Trade Lamb Indicator (ESTLI) has only been higher at this time of year in the last week of January last year.

According to Mercado this means that producers who usually sell lambs in early January can now lock in the highest price they have ever received.