The Sheep, Deer and Cattle Report: Wool still weak at auction and shine goes off prime beef prices

LAMB
Lamb schedules remained steady this week, as the recent lift has been credited to a small opportunity in the UK chilled market, but dampened demand is seen out of China due to a drought driven increased domestic supply.

Lambs are now being checked for teeth growth as they change into hoggets’, and there has been a surge of processing numbers as farmers look to beat the impending discounts.

Christmas trade contracts are around the $6/kg mark but are predicted to fall significantly over the summer period for frozen carcasses.

Lambing in the southern foothills is now in full swing and good weather and satisfactory feed supplies suggests strong lamb survival rates, while in the north docking will be well through and farmers will be readjusting their budgets.

Weak demand for lamb pelts and an oversupply of sheeps runners are both impinging on sheep meats pricing, and some analysts are pessimistic returns will not even reach last year’s average results.

WOOL
This week’s South Island wool auction was again weak, and only 78% of the offering met vendors expectations in a market short on demand.

Crossbred indicator prices again fell to lows not seen for three years, and will be especially disappointing for farmers as buyers report the quality presented has been excellent.

Wools of NZ posts it's first annual profit at $1.48 million but still need income from its Wool Market Development Commitment to continue to be viable. While now only a small percentage of this firms income the loss of this funding in mid 2018 will test it's business plan, and it's assurances to shareholders, that it can standalone and be profitable after that time.

Wools of NZ are offering two second shear contracts that with specfic specifications are returning $4.40-$4.70/kg clean to growers which they say is 10% above the present spot market.

BEEF
More beef schedule falls this week, as the US market remains very quiet as record domestic kills for cattle and pigs has driven prices lower, and caused some closures of big feedlots.

Local trade schedules have fallen with export in the north island but remained stable in the south where animals are slower to fatten.

Prices for prime steers at saleyards are steady around the $3/kg live in the south but 20c/kg lower in the north and are 20-30c/kg behind last year, but as yet store animals are selling at prices well ahead.

Ravensdown has fixed the price of super at $310/tonne and pledges to keep this price stable until the 16^th December, amid reports of increased usage of the product as dairy farmers return to all grass systems.

DEER
Venison schedules eased this week, as numbers filled the plants chasing the chilled market premiums.

Alliance announced the building of a new specialty venison processing plant at Lorneville as they plan to reduce killing costs by 30%, and as part of this change to replace the Makarewa facility they will also sell farm land for the new dairy hub for Southland.

Velveting stags will be being harvested now in big numbers and frozen down for early sales, but as yet there has been little indication of where the market is at.