At the Hamilton sheep sale recently, agents quoted light sheep at up to $4.20-$4.30 a kilogram.

The National Livestock Reporting Service said a run of sheep generally ranged from $3.45-$3.90 with several sales over $4 a kilogram at the sale.

Mr Pertzel said he had never seen the Hamilton market dearer.

“It’s frightening – it is certainly not a good thing for the industry.”

He was concerned the current demand was bringing in too many breeding sheep and would lead to abattoirs going broke, ultimately leading to a lack of competition at saleyards.

“The rates are not sustainable.”

Lanyons auctioneer Warren Clark said he was expecting a correction but processors generally had to pay $4/kg dressed to compete on Thursday.

“The mind boggles – there has got to be a correction, but not this week.”

In the last two weeks the combined sheep yardings at the Wagga and Bendigo saleyards have been about half the Hamilton saleyard throughput. Ballarat saleyard yardings fell to 52 per cent of Hamilton’s sheep numbers last week.

“It’s scarcity of sheep – that’s the problem,” Mr Clark said.

Balmoral prime lamb producers Geoff and Aira Kemister sold 57 mixed age white Suffolk cross ewes for $135.20 to T. and R. Pastoral through Kerr and Co Livestock. NLRS estimated the ewes would dress 33 kg and had a $4 skin, bringing them out at about $3.95 a kg carcase weight. The 27 seconds made $96 for the Kemisters. Mr Kemister said the rates were their best prices in 20 years.

“When we came in we said if we averaged $70 we would be happy.”