National average market values for livestock: IRD

The national average livestock taxation values produced by the Inland Revenue gives us a snap shot at prices in the livestock market.

With a year of volatility with product prices some disalignment with their earning capacity is evident depending on when purchases were made.

In the sheep sector ewe hogget values have remained steady from last year and the margin for taking these animals through to two tooths looks good.

Their value being made later in the season looks to have the downturn of lamb values factored in. With many above average farmers mating hoggets this early entry point into the breeding market is close to their productive value.

Two tooth prices are the highest seen in the last 10 years and show a lift of nearly $30/hd on last years values.

There has been a wide range of prices achieved for these young sheep as the early sales were made while the lamb schedule was bouyant and prices reached $300/hd for premium stock.

Mixed aged and older ewes  lifted in price by $14-$22 a head on last year, but  for fertile sheep will provide a good return on their investment even if sold only one year after sale.

The downturn in numbers in the sheep industry has given farmers an opportunity to upgrade the quality of their flocks and productive returns are improving as they do that.

With the mutton kill down 26% from last year it appears many farmers have already had a good cull and the stellar grass growing season has encouraged stocking rates to be kept high.

Optimistic beef prospects combined with good feed levels have seen beef prices at record levels. There has been some disparity between recent product prices for beef and livestock values especially in the bouyant calf market but most agree grass and ample winter feed supplies have been influencial price drivers.

Substantial capital is now invested in large cattle herds and low interest rates have helped maintain some margin in the face of these new high values.

The dairy pricings reflect the rapid growth in that sector and resulting demand for quality stock but large price variations do occur dependant on their recorded genetic background.

It's interesting to note that the mixed aged Friesian type animals value of $2155 needs a $6.45 payout at industry average 334kg/ ms to pay for its capital cost in the one year.

With a major downturn in milk pricing and increase in costs  farmers will be looking hard at capital cow values as they adjust to the new dairy income norms.

Deer values reflect the stable product pring now evident in a once volatile industry. Industry strategy is aimed at improving average productive performance to levels achieved by the top 10% of the sector which if achieved could put another $30 million into deer farmers pockets.

All animals values are aligned nicely with their productive value and if per head performance can be improved will allow profitable growth to resume in this industry.