Farming: Livestock prices are keeping black ink on farmers' bank statements

Livestock trader and commentator David Cotton is delighted that prices are keeping black ink on bank statements. Photo / Bevan Conley

Livestock prices continue to produce black ink on bank statements even as trading enters its traditional quieter period.

Independent Whanganui livestock trader and commentator David Cotton said even the weather was now playing its part.

"September was one of the driest I have recorded on my Kai Iwi farm in 25 years with just 53mm falling," Cotton said.

"That was fantastic after the 230mm that fell right in the middle of lambing in July/August. Things have dried out now and the newborn lambs are loving the sun and warmth as the days get longer. We now move into a quieter period for livestock trading and agents can take a well-earned break. There were less that 2000 lambs yarded at the Feilding sale last Friday."

Cotton said most breeding farms were at the end of lambing and docking was well under way.

"And with good results, I hear. Trading farms are killing last season's lambs at record prices, while keeping an eye out for teeth popping up - that would devalue them by $50 to $100 a head. In the meantime, mutton contracts are out at a whopping $6.15/kg - I can't believe it. We couldn't even get $6/kg for lambs three or four years ago. It means a heavy, dry ewe is fetching over $170 a head," Cotton said.

The cattle schedule is also healthy topping the $6/kg mark to encourage farmers to kill versus retaining them on-farm to put on more weight.

"The store cattle market is holding up very well as you would expect in early spring," Cotton said.

In his market report in December 2015, Cotton asked for a $6/kg lamb schedule, a $6/kg cattle schedule and a 6 per cent interest rate.

"I did not ask about an increase in wool price as I knew even Father Christmas has his limits and that asking for what seems the impossible is just that, impossible.

"Wool remains a complete disaster, but wow, let the good times roll with the rest of it. Lambs are at $8.50/kg, mutton $6.15/kg and interest rates are under 5 per cent, even the goat schedule is $5.50/kg."

And with his Horizons regional councillor's hat on, Cotton praised his fellow farmers for their environmental work.

"Farmers are doing great environmental work down on the farm and that is only possible when there is black ink on the bank statements. Much of the money from the excellent stock prices is being channelled back into the farm."