Farmers are assured normal seasonal demand, which sees venison schedule prices peaking in spring, will return.
“This premium rewards farmers who are able to carry finishing deer through the winter for processing from September to early November as chilled venison.
“This is highly sought after by northern European customers during their game season,” Coup said.
“We have already seen an easing in the venison schedule since December but no-one is expecting it to fall out of bed.
“It is simply a return to a typical seasonal pricing pattern, albeit at a much higher level and with a less of an autumn dip than has been the case in the past.”
In 2016 the spring premium was much reduced.
In 2017 there was a short price dip after Christmas followed by a steady climb in schedule prices from February to October last year.
There was strong procurement competition between venison companies for a much-reduced deer kill and an unprecedented appetite for lesser grades of venison from the United States premium pet food market.
“With their spring price premium gone farmers decided it was in their interests to hold more of their deer on-farm and kill them in the autumn at heavier weights.
“This increased the proportion of venison that was frozen after processing.”
It also reduced the supply of chilled venison to the northern Europe game season market by 40% over two years.
With NZ venison at record prices and prices for premium beef cuts falling in Europe during 2018 some European customers switched from venison to beef.
Others substituted NZ frozen venison with European feral venison.
That, combined with a long, hot European autumn, reduced the game season from 12 to six weeks and led to reduced sales of frozen NZ venison.
“In contrast, game season sales of chilled venison were very strong and if more had been available it would have sold at excellent prices,” Coup said.
Since the end of the season there have been very constructive discussions between the individual venison companies and their marketing partners in Europe, some of whom are carrying over stocks of frozen venison from the 2018 game season.
“Each company makes its own decisions but everyone clearly sees the importance of farmers getting a spring price premium if Europe is to get the chilled NZ venison it wants for its game season.”
The move to a more traditional schedule price curve was predicted by DINZ and venison companies last year.
“The peaks and troughs during the year will probably be less pronounced than in the past,” Coup said.
That is because of the success of the venison companies in developing year-round markets for chilled venison, especially in North America and under the industry’s Primary Growth Partnership Passion2Profit (P2P) programme in Europe during the summer.
Meantime, farmed deer numbers, including the number of breeding hinds and fawns, increased in 2018 according to provisional agriculture census figures released this month by Statistics NZ.
That follows a small recovery in stag numbers in the 2017 census.
Coup said the trend is a strong indication of growing farmer confidence in the viability of deer in a drystock farming operation.
Hind numbers in the year to June 30 2018 recovered to 413,400 from a low of 392,300 in 2017.
It is the first firm indication that the long-run decline in deer numbers that began in the late 1990s has ended and that a recovery is under way.
“But what’s even more interesting is that the statistics indicate a dramatic increase in hind productivity.”
Farmers reported 84% of hinds weaned a fawn in 2018 compared with fewer than 73% in 2008.
“This increase probably reflects the efforts farmers have been putting into improving hind nutrition and management.
“It also means deer farming, along with strong product prices, is able to compete better with alternative land uses.”
Coup said that was a key objective of P2P.
The 2018 increase in hind numbers of about 5% is seen by DINZ as sustainable if it continues in coming years.
“If this growth rate continues it’s one that our venison markets should be able to handle.
“By and large it is coming from the expansion of herd numbers on existing deer farms and to a lesser extent from newcomers to the industry.
“We don’t expect to see a large influx of new deer farmers,” Coup said.
