Finished Merino lamb prices have surged to more than 1110c/kg carcass weight as rates near those paid for traditional prime breeds.

Figures compiled by the National Livestock Reporting Service calculated the rolling seven-day average price for Merino lambs at 1064c/kg on Monday but it hit a high of 1118c/kg last week. This is more than double the rate of a year ago, and came within 30c/kg of the national heavy lamb indicator.

Meat and Livestock Australia’s NLRS manager Stephanie Pitt said the gap between Merino lamb prices and traditional trade and heavy lambs had narrowed noticeably over the past year, which reflected a market that was “exceptionally tight” across all lamb categories. “Merino lamb prices are currently sitting at historically high levels,” Ms Pitt said.

“While the industry’s formal indicators focus on trade and heavy lambs, Merino lambs have ridden the same market upswing and are achieving some of the strongest values ever seen.”

Ms Pitt said the price differential between Merino lambs and prime trade lambs was currently well below long term averages.

“This is being driven less by a Merino specific surge in demand and more by exceptionally strong demand for lamb overall,” she said.

“A smaller national flock, reduced turn off following prolonged dry conditions, and processors competing to secure enough stock to keep chains running have lifted prices across all breeds and weight ranges.”

TB White livestock agent Xavier Bourke from Ballarat said Merino lambs were making more than they had in the past for two reasons.

“Merinos that have been on grain and are heavy are making close to the rates you see for a good crossbred because they are being finished well,” Mr Bourke said.

“But the genetics are better too in Merinos with those who have worked on the meat side of breeding. Merinos used to be good at wool and not so much at meat and now they are good at meat.” Mr Bourke said there was still a discount for Merino lambs sold over the hooks, but the gap had become smaller.

“Over the hooks rates are probably 30-40c/kg lower for Merinos whereas that discount used to be a lot bigger,” he said.

Elders Mark Flagg agent Mark Flagg from Griffith, NSW, said skin values were contributing to the better rates for Merino lambs, but so was the quality. “I think we can see that some Merino producers have been breeding meatier types of lambs and that’s helping with the prices for these,”Mr Flagg said.