Trends for lamb and wool

July 2010

Schedule increases appear to be running out of steam, as the traditional winter rise seem to be easing in the schedules, and prices are now about 80c/kg behind last year.

The world’s new rules for credit means companies are now more cautious chasing stock with price, and need to reflect this in market related schedules.

Silver Fern Farms resizing was confirmed in Canterbury, and the lack of supply of stock has seen an increasing commentary on the future direction of the industry. Fears are that a “last man standing system” is what many producers feel is ahead, but to preserve this industry, leadership needs to come up with a better plan than that.

A lot more honesty is being expressed as to the industry’s state, but with product selling for record levels overseas, and producers still exiting because of lack of profitability, serious challenges remain.

The trend is steady .

The schedule is about 79c/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 .57

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 have peaked, with surplus feed scarce and often chased by more profitable dairy grazing options.

Wool Prices

Prices held firm at the latest sale, with big lifts in currency ignored in pricing, although passings were still at 20% of the sale.

 Maybe this is reflecting quality issues, as buyers are starting to shy off inferior lines at these levels.

This is a huge challenge for the industry, keeping quality standards up, when price levels do not compensate for the cost to maintain them.

To survive the sheep industry needs a stronger wool price to keep profitable.