Livestock prices are ticking over well as the new season of trading looms

The plough signals the beginning of the new season in farming.

The plough will soon be turning the soil in preparation for a new season of trading in farming.

Already the paddocks are starting to fill with new season lambs, the kind weather helping survival rates which will help offset the low scanning rates and this will be great news to meat companies. But with this comes a warning of sorts.

Independent Whanganui livestock commentator, trader and farmer David Cotton said the favourite topic of conversation among farmers down at the sale yards will be the possibility of a wet summer after the dry winter farmers are currently enjoying, or will this be the beginning of a drought on the west coast as the onset of La Nina suggests.

Independent Whanganui livestock commentator, farmer and trader, David Cotton.

"As we move into a quieter part of the season, we start to count the number of days left in this killing season to get old season lambs killed before their two teeth show up," Cotton said.

"The juggling begins between increasing weight and the teeth begins. I commented in June how the store market for both lambs and cattle were out of alignment with the killing price (store are cheap buying). I have to say eight weeks later the opposite is true, especially with lamb trading. The store lamb market looks well overheated from where I sit.

"With a $7.40/kg schedule equal approximately to $3.20/kg liveweight, it's hard to see there's much profit in buying store lambs at $3.80/kg-$4.10/kg. The first month of fattening these lambs would only get your bait back at best. I am not hearing an $8/kg+ schedule for the last of the season, but I may be wrong – I often am."

Meanwhile, he said ewes with lambs at foot looked good buying ($90 to $120 per head) when compared with other livestock available, especially when taking into consideration what was paid for ewes at the ewe fairs earlier in the season.

"The sheep schedules remain steady with no major changes over the last few weeks. Lambs area at $7.20/kg-$7.40/kg and ewes $5/kg.

"Cattle schedules have taken a small lift from last month, but the store prices have rocketed up. No surprises at this time of the year. Hawkes Bay farmers restocking their properties after the drought being one of the main contributors to the increase in market price then add in good ground temperatures for early spring growth," Cotton said.

"You have to feel sorry for the Hawke's Bay farmers' balance sheets when you look at the prices they would have sold cattle at post lockdown.

"In Late May, 2020 rising 3-year-old steers fetched $2.68/kg while in August, 2020 they were $2.95/kg, rising 2-year-old steers $2.40/kg compared to $3.20/kg in August, 2-year-old heifers $2.30/kg compared to $2.90/kg and yearling steers $3/kg compared to $4/kg.

"We have to count our blessings in the farming industry as post lockdown I believe we are ticking along well compared to friends and family I have spoken to over the last month in different industries that are in serious trouble.

"To our urban friends we farmers are working hard to ensure New Zealand is a great place to live work and play," Cotton said.