Thursday, March 28, 2024

Cattle peak may be close

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The North Island cattle kill is starting to ease after a huge last four to six weeks, Affco national livestock manager Tom Young says. “Suddenly, it got hot and dry and every farmer decided to kill at once – a lot of bulls, a lot of prime and dairy cows as well.”
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The rush followed a slow start to the season because of rain and lush pasture into January.

Affco’s prime kill usually peaks in December/January and the dairy cows in mid-April and May but this year it all came through in February/March.  

Big dairy areas Waikato, Taranaki and Bay of Plenty dried out at about the same time. 

“We’re still flat out trying to clear the backlog but we can see it just starting to ease.”

Affco’s spread of large plants across the island means it can plan and cope with the throughput.

Dairy cows have traded down to about $3.60/kg in the North Island and Young expects the price to remain around that level for a time. 

More cows will come through in mid April and May but numbers won’t be great and there could be competition between processors keen to keep plants busy.

Prime cattle have settled in the $5.20-$5.30/kg range in the North Island. 

A good chunk of Affco’s prime market is the domestic summer barbecue season, which starts to slow-down about now.

Anzco Foods isn’t seeing any let-up yet in cattle numbers with waiting times still around the typical week to 10 days, supply chain and livestock general manager Grant Bunting said. 

“We’re happy with the volumes. There’s been plenty of bulls.”

Nelson and Marlborough farmers are being prioritised because of drought and fire issues, including water infrastructure. 

Bunting sees the cow market softening because of general commodity pricing and little help from the NZ dollar.

Farmers are not hesitating to let cows go early if they are dry, bringing forward the usual April peak. Another supply surge is expected soon, of cows not in-calf.

The prime cattle market has also softened and that is reflected in lower store and weaner calf sale prices.

The South Island lamb kill continues to build from low levels but most areas still have good feed levels and farmers are holding lambs back as a yield play as they put on weight, he said.

Young said North Island lamb numbers have dropped off after a good run because of dry conditions and another flurry is expected in a month or so. 

But he wonders about the depth of supply, suggesting there might not be a lot of lambs left. 

Ewe numbers have been down and the east coast lamb losses in September’s storm might have been greater than thought. That is keeping North Island values at historic high levels.

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