The Weekly Livestock Report: Optimism abounds in dairy as new season starts

DAIRY

With calving in full swing in northern areas and now underway in Canterbury, the present mild weather conditions have been very helpful to lift covers and improve the survival of newborns.

Early vigilance is being encouraged by advisers to control mastitis and regular magnesium supplementation is important at this time to control grass tetany.

Farmers are heartened by the improvements in water testing by the Ministry of Environment which reflects a satisfying return for their time and money to improve their industries footprint on the landscape.

Surplus bobby calves are selling strongly at the saleyards with buyers reporting they have had to pay more than last year to secure quality animals.

Optimism abounds in this sector shown by a record payout for LIC, Synlait shares trading strongly, the globaldairytrade index increasing, and Fonterra today announced a rise in predicted payout to $7.50/kgms.

Fonterra warns however that this years earnings per share will be at the lower end of the range, with the drought and their Australian business reshaping, dampening profits.

My Farm has launched a new investment package aimed at small investors interested in buying into dairy farms and capitalizing on the strong future prospects for this sector.

LAMB

In a period of short supply regular price rises are now common, as chilled demand is building in Europe and frozen stocks are reported to be in a comfortable position.

Pressure is mounting on the major meat companies for action on reforms as apprehension rises that improved market prospects may derail long term proposals.

Statistics NZ figures show that sheep, beef, and deer numbers all fell in the 5 years prior to 2012 by more than 20%, whereas dairying rose by 13%, showing all the importance of reforms to reinvigorate profits in these sectors.

Farmer confidence has rebounded, led by a much improved feed status and better short term prospects although the affects from the drought will be medium term for some.

Chinese demand has seen mutton schedules lift to give better value for scanned dry ewes, but pelt prices have eased with buyers finding previous levels unprofitable.

WOOL

The new season starting in July has seen crossbred wool prices maintain near yearly high levels, but mid micron are trading at yearly lows.

Volumes are back due to the drought and land use changes but a better feed season may see some return to more frequent shearing which should help repair wool flows.

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BEEF

Some signs are being seen that the US beef market is on the improve, as previous manufacturing stocks have disappeared and domestic supplies will be restricted due to the large drop in stock numbers.

Bull, manufacturing and prime beef schedules are all way ahead of last year, and traders who replaced cheaply will be looking for better profit levels.

Hide prices are reported to have reached record levels, as NZ’s quality product and a recently lower exchange rate has driven demand.

DEER

Exporters report the venison market remains lacklustre, and most are waiting for the game season consumption period to start.

Chilled retail demand is still strong however, and with the Euro currency 10% weaker than last year, producers will be looking for more schedule upside running up to the November peak.

Early stags will be casting buttons ready for the new seasons growth, in a market reportedly with little stock on hand and more stable prices predicted.

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Here are some links for updated prices for
- lamb
- beef
- deer
- wool

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