Mutton averaged the highest price for 2010 at 450c/kg last week. The market settled at 446c/kg on Tuesday.

Prices have been strong all winter and were at 408c/kg when autumn finished at the end of May.

But it is a different story to last year, when average prices were about 286c/kg in early September.

Sheep prices have been so strong in recent months that many processors simply cannot afford the new price levels.

Rawlinson and Brown livestock manager, Gavin Brady, Griffith, said the status quo would continue for as long as sheep numbers continued to struggle.

“Around here, it’s pretty much like everywhere else at the moment – there’s not been a lot of mutton going through,” Mr Brady said.

“Last week, there was a total of 8000 yarded and only 1000 of those were mutton, which is very low.”

He said a combination of growers keeping older sheep to build up stock numbers, and wet weather slowing shearing, had hindered the supply of mutton in recent weeks.

But he believes the good season around much of NSW will entice some processors back into the market, despite the higher prices.

“The season is generally good in most places and there will be extra competition for meat companies and this could push prices even higher.”

Davidson Cameron McCulloch and Company branch manager, Daniel McCulloch, Tamworth, said low sheep numbers had been the main reason for the high prices across the New England.

“Prices have been pretty good around here,” he said.

“However, some processors are finding it too dear to enter the market, and this could have an effect at some stage.”

With overall sheep numbers across Australia declining, Mr McCulloch said prices might continue to be strong for a number of months.