Lamb, and wool trends

June 2010

The lamb schedules regained their upward winter rise, with most companies offering over $5 a kg, which is about 48c behind last year.

The currency and economic situation in Europe will determine whether that difference will be reduced, but returns of at least this level, are needed to slow the exodus to other land uses.

Industry rationalization again was evident, with SFF shutting its lamb cutting plant in Belfast and amalgamating its rendering operation. This has been driven by lower lamb numbers, as well as greater competition from AFFCO in the South Island.

The Talley family are obviously optimistic about meat, as they have announced a takeover bid for major control of their AFFCO stake. 

The trend is rising .

The schedule is about 48c/kg behind last year but  is rising. The currency has now strengthened with the US$ now at .70c and the Pound to .47p and the Euro at .56

Mutton prices continue to rise with prices at record levels, and many ewes selling for over a $100 in the saleyards in the south. Store lamb prices seem to have peaked, but primes are still significantly lower in value at northern saleyards.

MAF Outlook Report suggested Lamb would average $4.13c/kg in 2011 season, or $72 per hd for a 17.5kg lamb.

Wool Prices

 No sale this week but the news that dominates, is the failure of the proposed merger between the two wool groups, Wool Grower Holdings and Primary Wools.

This is a major disappointment for all wool growers, as values have got so low, only a unified approach, with a low cost structure, would have a chance to reignite returns.

Now this is lost, it’s hard to see these companies convincing farmers to reinvest in wool. Many are now treating wool as a cost, and prioritizing other genes of the sheep, when selecting replacements.
 

MAF Outlook Report suggested Wool  would average 384c/kg Clean kg in 2011 season