Kelly Country: NZ markets opposite to Australia’s booming prices
Angus cows have been selling to 155c/kg in New Zealand, at a time when Australian prices are booming.
ANOTHER country, another saleyard — but a very different price dynamic for livestock compared with what is happening for cattle and lamb in Australia.
The Temuka prime market is the largest in the South Island of New Zealand, and yesterday The Weekly Times witnessed first hand the opposing price trajectory for beef, lamb and mutton across the ditch compared to home.
Good Angus beef cows weighing 660kg were struggling to make 155c/kg liveweight (prices are almost at parity, with $1 New Zealand worth 96 cents Australian at the moment), and Romney-cross store lambs with an indicator weight of 31kg met dull competition to sell for $111.
In a reverse of what has happened in Australia, livestock prices in New Zealand have crumbled since Christmas with agents and farmers pointing the finger firmly at coronavirus and the effect it has had on export shipments to China, with dry conditions across parts of the North and South Islands also playing a part.
Agents said the meltdown in New Zealand prices had been dramatic.
“Only a few months ago we were like Australia and had big prices,” agent Bruce Dunbar, of PGG Wrightson at Fairlie said.
“Back in November we sold big old ewes for $378 which is the most money ever seen in these parts — today you would be lucky to get half that.”
Local farmer Paul Rivers, of Geraldine, described the New Zealand meat industries as being in “crisis”.
“The cattle industry, in particular, is in absolute crisis because of what is happening in China,” he said.
“Coronavirus has stuffed our meat industries, our wood industry and our tourism.
“We have really stuffed our bacon by relying on China so much.”
It is an emotion-driven statement, but export data shows how New Zealand has built its lamb industry around exports in the past two decades, sacrificing its domestic sales base in the process.
Figures from the OECD-FAO show in 1991 New Zealand lamb sales were split 20:80 between domestic and export sales; this year that ratio is 5 per cent domestic sales and 95 per cent export.
It meant New Zealand shipped 390,000 tonnes of sheepmeat last year, not far behind Australia which holds the mantle of the world’s biggest exporter at 465,000 tonnes of lamb and mutton.
But tellingly for New Zealand, and why coronavirus was such a hot topic at the Temuka saleyards, more than half of its sheepmeat exports (54 per cent to be exact) went to China last year.
New Zealand sales of beef to China have also ramped up dramatically in recent years, and it has also become their key market destination.
Agent John Farrell, of PGG Wrightson at Temuka, said the New Zealand livestock industry lacked the protection that Australia had with its bigger spread of markets, including a better domestic base of red meat consumption. “We rely on exports so much, and particularly to China in recent years,” he said.
At Temuka lamb prices that were nudging 900c/kg carcass weight before Christmas were now struggling to hold 700c/kg — if you could find kill space. Mutton was down to around 450c/kg. For cattle the indicator rate for good prime beef had fallen from 600c/kg carcass weight to 400c/kg.
These are some actual auction sales witnessed by The Weekly Times yesterday:
ANGUS-Friesian bullocks, 680kg, reasonable types and in fat score 3 and 4 condition, made 240c/kg liveweight.
HEREFORD-Friesian steers, 507kg, made 219c/kg.
ANGUS heifers, 631kg, made 238c/kg.
HEREFORD cows, 800kg, made 156c/kg live.
In the lamb market they have a system where portable scales are used to weigh a sample of the bigger lines of store lambs. Although strangely, this information isn’t displayed for buyers but is used to help compile a market report.
Some sales included:
360 Romney-cross shorn lambs, 31kg live, made $111.
40 Dorper-cross lambs, 36kg, made $116.
90 Suffolk lambs, shorn, 36kg, made $116.50
Agents said feedback from meat processors was that shipments to China had slowed, and meat was now being stockpiled in chillers.
“We are being told that nothing much is going out and that freezer space is now chockas,” Neil Hewitson, operations manager at Temuka saleyards, said.
“Confidence is down and there is a bit of panic going on.”
‘No one knew it was coming’: Tongala cow abattoir shuts
The livestock industry and local community have reacted to Greenham’s closure of its Tongala cow processing plant.
Wool producer rapt with market revival
Prices for Steven Wishart’s wool clip are getting towards “a fairer return than where it has been”, the Inverleigh sheep and wool producer says. This is what he is planning.