As lamb prices push past figures posted in recent years figures, an industry expert hopes the good return is a sign of future continued growth for the industry.
The prices should have farmers smiling with the schedule having gained momentum for old season lambs recently.
Last week’s latest North Island schedule released by AgriHQ show farmgate lamb prices are on the rise — lambs weighing 17.5kg are fetching $125.13 a head, up from $124.25 the previous week and $105.00 at the same time last year.
Lambs weighing 19kg are fetching $135.85 a head, up from $134.90 the week before and $114 last year.
All prices across both weights are up 10 per cent on the five-year average.
Beef & Lamb New Zealand is forecasting a good season for farmers off the back of steady prices and production.
But while the “positive” prices are welcomed by Wairarapa Federated Farmers meat and fibre chairman William Beetham, he was hoping that the strong returns signal a comeback for the industry.
“This is a really positive sign for our industry — let’s face it, lamb values have struggled over the last few years and I think it’s a really positive sign,” he said.
“There has been a slight shortage in supply and an increase in demand, but I think the increase in demand has been because of the work done in promoting the product and we want it to keep going.”
Marketing strategies done by exporters, including Beef & Lamb NZ, have “good things happening” in terms of adding value to the product.
It is important the prices are sustained at this level with a focus to add value to the schedule in the industry, he said.
“I really think [high values] have been part of the good work going on and I can’t see why it can’t be continued.”
Mauriceville farmer Alan Stuart said old season lambs are traditionally right for good prices.
“Prices were usually fairly steep because they are worth quite a lot due to their mature meat, and they are quite big lambs,” he said.
Mr Stuart sold some old season lambs last week, weighing about 22kg and he made about $144 each.
“That’s a good price”.
He expected the new season lamb will come on next month, and as a result prices would drop about February, down to about $5 to $5.50 per kg.
“There is always a scarcity of that product, and processes and exporters are screaming out for lambs because the new season lambs hasn’t come on yet. When they do there will be a good supply and the price goes down accordingly.”
“It’s a special time in the market, when there is a scarcity of the pre-Christmas product around and they have to pay that type of money to attract producers, and that’s why prices are this high at this time of year.”
The bigger lambs are sold before Christmas and the chilled meat is sent to the northern hemisphere.
PGG Wrightson provincial livestock manager Steve Wilkinson said lamb returns are good for this time of year.
“Because the supply will come onstream through November, the prices will ease, but overall, they will be better than last year,” he said.
Just now, prices are sitting at around $7 to $7.10 per kg — “a good return at this stage”, he said.
“Store lambs have pretty well finished, the new season store lambs will start in November and are expected to meet with good demand.”
Farmers were just starting to get docking results coming in but the weather was starting to have an impact.
“Survival looks to have been pretty good, and the biggest impact will be ewe losses through bearings.”
Beef & Lamb NZ chief economist Andrew Burtt said this year’s outlook was a steady improvement.
He said much of the outlook for this season depended on the value of the New Zealand dollar, which was expected to ease as major trading economies strengthen.
Mr Burtt said last spring many farmers held onto their lambs to rebuild their stocking numbers, and this year there could be more lambs for processing.
“The lamb crop is expected to be back a little bit across the whole country.”