Friday, March 29, 2024

Trump blamed for Chinese absence

Avatar photo
Many Otago sheep farmers are holding back a lot of wool from sale because of low prices, Federated Farmers provincial chairman Simon McAtamney says.
Reading Time: < 1 minute

“It means there’s a big stockpile to work through and that’s likely to keep prices depressed.”

McAtamney, who was on the national meat and fibre industry group, said one theory for the continued near absence of Chinese buyers at auction, the major reason for the fall in prices, was that manufacturers there feared trade tariffs being put in place in the United States by president Donald Trump.

Most Chinese end-products were sold in the US and the issue was likely to take some time to play out, one way or the other.

While a lot of farmers were holding onto their wool, Balclutha farmer McAtamney was shearing and selling to keep wool and cashflow moving.

While prices were very low, money still could be made from a ewe fleece because of the volume of wool.

“If you’re getting 3kg to 4kg of wool, that means $8 to $10 a fleece, against shearing costs in the $3.50 to $4.50 range.”

He didn’t shear lambs but said prices mean farmers who did would be struggling to make money.

Wool made up about 15% of McAtamney’s sheep income last financial year, including a period of higher prices, but he reckoned the figure would be below 10% this year.

He thought meat returns from lambs were tracking well this year and they might have been $10 a head higher except for the impact of the Brexit vote in the United Kingdom last year.

Generally, McAtamney said the wool sector was suffering from a fractured  industry, with farmers having a lack of market information.

Total
0
Shares
People are also reading