The big difference in the comparison is the higher conversion value of the NZ dollar, currently US72c compared with 62c last June.
That impact alone is unfavourable by $300 a head, a Silver Fern Farms (SFF) spokesperson said.
In the North Island the schedule price is $5.35/kg CW for M2 bull, but if the NZ dollar remained at US62c the schedule could be over $6.
The procurement percentage of meat company schedules over the in-market prices is sitting at 60%, compared with 55% last year and 73% five-year average at this time of the year.
Meat company representatives say market prices were only one factor in setting cattle schedules and hence the procurement percentage.
Many factors were positive for NZ beef exports presently, but companies had to look ahead and balance their processing capacities, storage and shipping needs while maintaining profitability.
Supply chain difficulties, no immigration for skilled workers and a sinking lid on plant tallies because of labour shortages all had to be managed.
At full capacity slaughtering in the cull cow season, just two weeks without shipments would be enough boxed beef to fill the nation’s freezers.
ANZCO Foods general manager of sales and marketing Rick Walker says imported beef prices in the US had risen steadily since the beginning of the year.
Among the reasons were the opening of foodservice outlets, greater freedoms for consumers and limited supply, especially from Australia.
Australian shipments to the US were down 40% this year, within a global trade shortfall from that country of 100,000 tonnes.
China was again providing strong competition for manufacturing beef and to their credit, the US importers had matched and exceeded the Chinese prices.
Walker says he expected the Australian beef supply to remain tight for another 12 months as farmers rebuild their herds after widespread rains.
NZ companies had quietly gone about the cow kill and tallies were 3% down on last year at this time.
“By the end of June, the cow kill will be done, and our manufacturing beef production will be low until the dairy-beef bulls come in the fourth quarter,” Walker said.
“Processors are not trying hard to grab every animal and set high tallies.”
AFFCO national livestock manager Tom Young says the procurement percentage was a very crude calculator that did not apply to more than half the weight of the carcase and was therefore misleading.
Offals, hides, prime cuts, and rendering products were all factored into the schedule.
“Costs have gone up considerably since the advent of covid, chief among them shipping,” Young said,
“Containers are hard to get and the freight rates have soared.
“Companies have sold product sitting in cold stores but until it is shipped and received, we can’t count on the money.”
Young says the high beef prices bid by the US importers were partly due to NZ’s inability to get the product to them.
SFF says returning consumer confidence, more travelling and socialising, the decline in covid-19 infections, the impact of vaccinations and the peak BBQ season, May 31 to September 5, were all positive factors for beef prices in the US.
Schedule prices have risen 40-50c over the past six weeks, about $120 a head lift, the company said.
The AgriHQ indicator for the country-wide bull schedule has risen from $5.15/kg at the beginning of May to $5.40 this week.
Senior analyst Mel Croad says the underlying factors in the high US beef prices were different this northern summer compared with last year’s covid disruption.
“US plants are running flat-out; US exports are strong and demand for all types of beef including imported lean is very high,” Croad said.
“These are factors that could last for some time and not temporary disruptions or distortions.”
