According to Meat and Livestock Australia's (MLA) National Livestock Reporting Service (NLRS), mutton yardings across Australia have been low, believed to be impacted by the recent heat wave and flooding across western NSW.

It may also be an indication of producers restocking.

Wether yardings were down by 45 per cent when compared to the same week last year, reflecting the increased volumes of Merino lambs sold off during 2009, while the national mutton consignments fell 56pc year-on-year, with WA yardings reduced by a massive 73pc.

Hillside Meats director Peter Trefort said mutton prices, particularly in the east, were extreme and combined with the high Australian dollar, made it almost impossible to make any profit.

"The mutton shortage, combined with high prices and the high Australian dollar, are making things very difficult," Mr Trefort said.

The NLRS said hot, dry weather conditions experienced in WA meant that some areas were now running short of water which was hampering carrying ability and forcing some producers to offload stock.

Last week also saw a return of the last of the major export works after a month's break, brought about by the current lack of small stock in the state.

"Despite all works now being open all are struggling to fill their capacities and they continue to work shortened weeks," the NLRS said.

"Many in the industry now question how long export works can be sustained in this environment of limited numbers and historically high values and it is expected that perhaps one or more will close down prior to winter."

Mr Trefort said he did not believe any processors would close down prior to winter, but could see a reduction in working days becoming a more common occurrence.

"Things are just going to get tighter, but when you need 100 people for an abattoir to work you can't just cut that down to 50 people, all of those positions need to be filled," Mr Trefort said.