Lambs still tipped to hit $8/kg mark with three months of season to come

A claim that lamb's wool has hit the $4/kg-$5/kg mark may not be as silly as it sounds.

A claim that lamb's wool has hit the $4/kg-$5/kg mark may not be as silly as it sounds.

The tongue-in-cheek comment made by independent Whanganui livestock agent and commentator David Cotton actually has more than just an element of truth about it.

The rub is that the lamb has to be sold along with the wool.

"I did make the claim and it sounds like a joke, but yes it does (hit the mark) if you sell your lambs on the store market," Cotton said.

"This month we saw medium small store lambs crack the $5/kg liveweight price and whether they were shorn or woolly did not make much difference to the price paid. A store farmer can shear his lambs before market and get somewhere over $3/kg for the wool and then pay the shearer. But he will be still getting a similar price to the woolly ones weighed on the truck — it's been a no brainer to sell woolly lambs."

Early in the month we saw store lambs hit dizzy heights with vendors smiling all the way to the bank, but Cotton has issued a measure of sage advice.

"My message to farmers is that all markets go up and down, so don't get greedy on a rising market. Don't think you can pick the top week to sell.

"The average price paid for lambs early May was $3.70/kg, peaking at just over $4/kg mid-May and dropping back sharply to $3.60/kg last week with the odd line down to $3.15/kg. If you are a glass half full person that's still $0.80 cents/kg more than this time last year. But what I'm suggesting is spread your risk."

Last month Cotton predicted an $8/kg killing price for lambs and still stands by that forecast.

"The killing price has been going up and last week hit $7.70/kg. But as usual tell me the weather and I will give you the market. It's just too cold and wet these last couple of weeks, also add to the mix is just the sheer volume of lambs coming out to be sold.

Supply and demand always plays its part, but there is still three months of the season to come and I believe the killing price will go very close to $8/kg."

Meanwhile, in-lamb ewes have cracked $200, which is not too surprising given the heat in the store lamb market and the killing price for mutton at $5/kg.

The cattle market has generally been steady but 30 to 40 cents less than this time last year both in terms of killing price and liveweight sales.