Past bad experiences are holding back some NI farmers from taking up lamb contracts. Dannevirke farm consultant Greg Sheppard has noticed that farmers are reluctant to sign up to contracts, mainly because they have been burned in the past. On the other hand some farmers think it wise to sign part of the lamb crop up to a fixed price given the economic climate reports Country-wide. Recession and feed issues are creating most of the uncertainty. Feed is tight in many eastern parts of the North Island and it may be difficult to find finishers. However, Sheppard is optimistic that store lamb prices will remain strong despite some areas already being drier than normal. He picks that if meat companies pay around $4.50/kg CW in January then store lamb prices may stay around $2/kg LW. At this margin there is money to be made in finishing. If store lambs are $1.80/kg LW and schedule prices in the $4.40/kg CW mark there should be around $18/head to be made. A calculation by an Ashburton-based farm consultant shows that there should be a return of around $0.18/kilogram drymatter consumed from finishing lambs. This takes into account killing charges and animal health. This is based on taking a 28kg store lamb to a 17.2kg CW lamb.
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