The IRD has recently released its national average market values for livestock for 2010.
Where have livestock values moved to in the last year and how do they relate to productivity? Look here for the 2010 IRD values in detail.
With the lamb price back on last year, the hogget values were back 9% but still the second highest value in 10 years. However with sheep numbers falling dramatically with dairy conversions and drought, values for two tooth, mixed age and older ewes actually increased by 5 % to the highest value ever. So how does this value relate to the sheeps productive worth. If the mixed flock ewe averages $105, and it grows $10 of wool, it would need to lamb at 118% of $80 lambs to pay for its capital value. The old stockmans adage "pay what you can earn off your stock in one year" seems to run true for many farmers, based on these values.Those farmers that paid $210 for two tooths in Southland will struggle however.
Beef cattle values increased by about 3% from the previous year - still well behind the spectacular prices of 2002 but a rise that keeps up with inflation. When we look at a cows productive value we see that at a calving of 90%, on this years calf prices, a cow will only return 57% of its capital value. Pasture control and this animals complimentary association with sheep, will make up for some of this deficency.
The national average values for dairy cows do not relect where market values are today, where strong commodity prices and high 2010/11 projected payouts have firmed demand. However tight monetary conditions and more conservative banking criteria on debt have restrained pushing dairy cow prices to the levels of 2008. If we say a m/a mixed breed dairy cow is $1,326 then at a $6 payout it would only need to produce 221kg/ms. Top producing dairy cows need only half a year to achieve this volume, and maybe this reflects why the dairy industrys debt is higher than traditional livestock farms.
Deer values reflect their productive worth, with farmers paying very little more than what they can be harvested for venison. Values have dropped about 11% and while the schedule is at present 19% behind last year, to return its productive value a hind killing at 55kg would need a schedule of $7.45. With the Euro falling in the last 2 weeks this still seems realistic.
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