Livestock trader: Saleyard auction system may be under threat to a new normal

The new normal may not include the saleyard auction system. Photo / File

There is little doubt when Covid-19 is beaten, New Zealand will face a new normal.

For independent Whanganui livestock trader, commentator, farmer and rural property real estate agent David Cotton, the new normal may well be a case of back to the future.

"With saleyards closed under a level 4 lockdown, farmers have had to get used to a different way of trading; in the same way as we have learned to Zoom into meetings versus attending in person. This virus has changed the way we live, think, and trade," Cotton said.

"I'm certainly not saying saleyards won't open and trade again, they have had a very important role to play. But I am saying that the days of livestock trading through a central saleyard are limited as farmers get used to new technology."

Closed saleyards have taken farmers back to yesteryear, hopping on the telephone and ringing farmer clients with livestock for sale and hustling buying orders.

"Not just a matter of booking them into the saleyards and the auction process taking care of the rest," Cotton said.

"The challenge for agents/vendors and buyers is to work out the fair market price without the saleyard system with livestock eye reports to guide them setting the price.

"From the private livestock sales I have seen there has been a very curious approach to buy in any store livestock with very good margins for those that have been able to kill prime stock and replace them at these new levels.

"Rob Gollan and I started Stocknet, an internet-based livestock trading system in the early 1990s.

"We wanted to drive efficiency into the selling and purchasing of livestock. We could not get the numbers of throughput to crack the market.

"I thought at the time we were 10 years ahead of our time. That was 25 years ago, and no one has cracked livestock trading online today, but this lockdown could just be the catalyst for change - so it's back to the future for me," Cotton said.

"In the meantime, I'd like to do a shout out to all the service industries that are working to keep farming ticking over, especially to the meat workers who hop up early every day and leave their families to keep the meat processing plant open. We owe you a debt of gratitude.

"With the drought conditions, being able to truck livestock off the farm even in small numbers to the meat plants helps us in several ways: Feed supply, cash flow, mental health.

"This also gives the ability of some finishers to purchase more store stock to keep the livestock market ticking over.

"In past years when farmers were under feed pressure there has always been the saleyards to dump unwanted livestock, even if the price was bad the livestock was off the farm - one less pressure with some cash flow.

"That option is not available with the lockdown. Add to that just how tight space is at the meat plants. The one major positive was the rain most of the North Island received last week.

"Also great news, the planet seems to be cleaning up in recent weeks, with less planes and cars, but with the same amount of sheep and beef - now that's not a surprise to farmers but it may be to our urban friends."