The Sheep Deer and Cattle Report: Very soft lamb market flies under the radar but will expose the need for red meat reforms

LAMB

Static lamb schedules this week as processing reverts to winter mode, and lack of sales into China after last years success is hitting hard, especially with the European and UK markets also soft.

Also lamb and sheep skins are oversupplied at the moment and some NI processors are trying to slow processing, by closing chains to prevent a build up of stocks in a very weak market.

This is causing some angst among finishers and those affected by the adverse floods and snow, as farmers now realise there maybe no spring lift and have decided to quit now, and are caught up in the delays.

Scanning is underway on the early mobs and small numbers of dry ewes are starting to appear at the saleyards.

A medium sized sale of in lamb ewes in the Hawkes Bay averaged $122/head, reflecting a little optimism among sheep farmers for the future of the product, even as present day lamb marketing is proving very difficult.

More details from the live sheep shipment reveal farmers received about $35/head more than the processing market to give those farmers an excellent return, and in the discussion with a Saudi trader he believes he can pay $200/hd for any future live shipments.

Shareholders of Silver Fern Farms have expressed concerns that the capital raising exercise may see the co-operative with a part foreign owner, and look to call a special general meeting to discuss the companies future direction.

An outbreak of foot and mouth disease in the UK may change the market into the EU significantly, and reinforces NZ’s vulnerability to a major bio security scare.

Beef and Lamb NZ report farmer disappointment at lack of accuracy of market updates on lambs, and pledge to increase frequency of these reports so farmers can plan better for the volatility in the market.

El Nino weather predictions are getting stronger as the year progresses, and the east coast of both islands will need a winter recharge of soil moisture levels or feed shortages will start early if the traditional patterns occur.

Desperate reports are emerging from drought stricken North Canterbury as many farmers are having to destock to minimal capital levels, to cope with one of the more difficult droughts many have ever encountered.

WOOL

No sale this week as insufficient wool and low stocks in brokers stores, saw the  South Island auction cancelled.

Last sale this week for the wool year and indicator prices for all classes except merino have lifted significantly on last years values, and are starting to contribute again to the sheep sectors profits.

BEEF

Beef schedules lifted again as the US currency falls to 68c and a 5 year low, and revitalizes prices in a global market short of stock.

Producers and Beef and Lamb NZ will be very disappointed the collaborative marketing venture between all processors has been canned, and this is just another sign that reforming the red meat sector will be difficult.

Saleyard prime steers are increasing in price as the winter progresses and are now at pre Xmas levels, and well ahead of where they were last June, giving finishers optimism spring pricing could firm even further.

Mediation has been ordered between AFFCO and the workers in the dispute associated with the Rangiuru works, as owners look for ways to improve the efficency of plants, all under pressure because of the reduction of through put.

DEER

Venison schedules have begun to lift earlier than normal, and give producers hope for a better priced chilled season which is just the fillip producers need, after years of low profit seasons.

New producer blood has been elected onto Deer Industry NZ in King Country farmer Bill Oliver, and it is hoped the nation’s deer herd will finish the retrenchment and start to grow again soon.