VICTORIAN lamb and sheep yardings have been stretched to the limit due to the recent record heat.

More than 110,000 lambs were sold at Ballarat and Hamilton last week.

However, it appears the recent rush of new-season lambs is slowing, with reduced yardings at opening markets this week.

Prices are also set to rally, following losses of 70c/kg for trade and heavy lambs over the past six weeks.

A 30 per cent rise in sheep numbers and 10 per cent jump in lamb offerings forced saleyard indicators down last week.

The benchmark trade lamb indicator ended the week at 367c/kg, down from its mid-October level of 437c/kg.

The indicator rose to 374c/kg following smaller yardings of 32,000 sheep at Hamilton and Ballarat on Monday.

Meat and Livestock Australia's sheepmeat analyst, Kara Tighe, said as trade and heavy weight lamb supply improved in recent weeks, prices came back.

"Last week, the large yarding in Victoria could be put down to the heat as well as the barley grass influx (seed infestation)," Ms Tighe said.

"This spring flush of lambs has been lower than last year, but the lambs have more weight in them because of the season.

"In this calendar year, the number of lambs slaughtered has risen by 6 per cent."

Mutton and feeder-weight lamb prices have continued to rise, as restockers scramble to secure supplies of light stock.

Nationally, feeder lambs have averaged $68/head over the past three weeks while mutton improved 11c/kg last week to 288c/kg, well up on this time last year when it was commanding 175c/kg.

"The Australian dollar continues to cause problems, particularly in sheep and mutton (markets), as declining flock numbers affect the market," Ms Tighe said.

At Ballarat yesterday, 35,700 lambs were yarded with restocker demand for feeder lambs mostly unchanged, with lambs selling from $59 to $80/head.

Trade and heavy weight lambs were up to $15/head dearer, with many sales up to 425c/kg carcass weight.

Across a yarding of 10,000 lambs at Bendigo on Monday, restocker lambs were $2-$10 dearer to a top of $84.50/head.

At Hamilton on Monday, restockers paid $4-$5 more for lightweight lambs, with many commanding $63-$79.