AgriHQ report June 20

A109 Light Utility Helicopter flight with mayor Gisborne City from the air in November 2023.

Almost all meat companies added more money to lamb last week and should do the same again next week, despite a short processing week ahead.

That has meant prices will be at or above $9kg for some companies.

When it comes to processing space, it varies across the North Island, dictated by staffing rates. Processors' hands are tied when it comes to effectively maintaining consistent throughput rates due to staffing shortages that are being magnified by further illnesses.

Bobby calf production will commence at some plants from next week. This has the potential to squeeze lamb slaughter space, but that won't really flare up until peak bobby kills get under way from mid-July.

While it's hoped the current supply of lamb will have seasonally reduced by then, with kill rates still so far behind, capacity is likely to remain at a premium.

May saw export beef volumes return to where they were in March, after a typical slowdown in April.

A total of nearly 50,000 tonnes was exported in May, tracking ahead of last year's 48,000t. Although still slightly less than the five-year average of 52,000t.

Manufacturing beef sales were back up to levels last seen in March. An obvious rebound in manufacturing beef sales into China was seen after a quiet April, with China taking 33 percent of the total share, their highest share since December.

This took volume away from the US, who took 41 percent of the total manufacturing beef volumes. Other frozen beef exports were almost on par with last year as volumes exported were the biggest since July 2021 at 19,000t.

Of the other frozen beef exported, 64 percent of this went to China, showing China still dominates the frozen market.

While China remains with their “zero-Covid” policy, there is a risk that they will continue to go in and out of lockdowns.

However, with beef a more staple part of the Chinese diet than the likes of lamb, and port issues not as extreme as they once were, it looks as though demand should be solid going forward.

PKE imports year to date as at April's import figures have grown 11 percent on the last year from a volume basis, at a massive 2 million mt imported.

This is the largest season's import since 2016-17 from a volume basis. However, the largest season in history from a value basis with this year's price per tonne NZ$307.2t. Edible oil stocks have constrained over the last year with shipping affected by rising crude prices, lockdowns, inflation, poor weather and interest rates. Palm oil has risen 58 percent YoY while soybean oil and canola oil futures have risen 33 percent and 27 percent respectively. Since the beginning of the conflict, these commodities have risen 36 percent and 25 percent respectively, with global futures trading having sat relatively flat throughout the start of the season.