Venison prices predicted to increase

Venison prices are predicted to increase this season, partly because of a drop in the supply of animals in the most useful weight ranges, agricultural economists say.

Deer farmers appear to have gained a greater understanding of the Cervena market -- -- in which NZ farm-raised venison is differentiated from traditional marketing of game meats -- and farmers may be able to get much higher returns in the future, Ministry of Agriculture and Forestry economists said today.

Using computer models based on information collected from deer farmers, MAF today reported projections of a 9 per cent increase in venison returns in the North Island, and a 14 per cent increase forecast for 2006-2007 in the South Island.

These increases would be helped by a projected lift in the net velvet price to between $49/kg to $50/kg in the coming summer, though s uch prices would only be half of those fetched by velvet in some earlier years.

The return to better velvet prices should be helped by a proposed new velvet selling organisation, called 0800 VELVET, a cooperative effort to align the length and timing of the sales period with demand.

This could have a significant impact on how velvet was viewed in the industry, the economists said.

Over the past year, deer farmers experienced another poor year with low prices for both venison and velvet, with the North Island model showing a 7 per cent lift in gross farm revenue to $110,632 in 2005-2006, mainly a small increase in venison returns.

Revenue for the South Island model dropped a further 1.4 per cent this year to $142,508, and the economists said rises in the amount of income deer farmers were earning off-farm indicated farmers were under pressure in both islands.

Venison prices began turning a vital corner in April 2006 with an average schedule lift of 75c/kg over six weeks through to June.

The national published schedule for 60 kg reached $4.39kg at the end of June, 11 per cent higher than the average of the past three years during the same time period.

The computer models showed venison revenue lifted 8 per cent in the North Island while the South Island model rose almost 2 per cent.

The 2005-2006 average price for velvet was static, and the low returned meant many farmers continued to view velvet as a by-product, the economists said. The national velvet herd has fallen by about 26 000 animals, leaving a velvet production capacity of around 530 tonnes.

The economists said the latest statistics for deer numbers (June 2005) showed a total national herd size of 1.705 million, and stable prices were needed before farmers would consider building up their breeding herd numbers.

A fall in the North Island kill numbers through April/May 2006 allowed venison plants to close for maintenance and meant the remaining farmers in the sector were holding onto their stock for spring, when better prices are anticipated.

The lower South Island took longer to clear, and killing capacity was a continuing issue with South Island deer farmers.

The economists noted a prominent issue in the South Island had grown around muddy deer -- deer with mud "dags" on their legs and bellies -- as some meatworks cut the payment for these animals by 40c/kg and in extreme cases refused to slaughter them.

- NZPA