The 6000 cattle from a failed live export consignment destined for China have now all sold in the local market.
The young dairy-beef heifers have been dispersed into local saleyards across the North Island after Hamilton-based livestock exporter Genetic Development NZ (GDNZ) was forced to abandon a contract to China when a livestock ship failed to arrive as planned.
The Chinese importer was not prepared to underwrite the process, so GDNZ could not fully honour the purchase agreement at the export premium value.
Taupō-based Central Livestock director Shane Scott says the 6000 cattle are now all cleared from the Tokoroa pre-export isolation (PEI) farm.
“It’s been a big effort by all involved to drip feed this number of cattle into sales over the past couple of weeks to ensure this did not end up as a fire sale.
“There’s been a lot of people involved, it’s been efficient and it’s been successful.”
While prices were well shy of the contracted export value, they reflected the local market.
“It’s what they are worth here, and as expected. Not everybody wants in-calf 18-month dairy-beef heifers, so to sell 6000 like this has been one hell of an effort.
“A few buyers came out of the woodwork and thought they might get a steal, but that was never the case at any of the sales,” Scott said.
Canterbury-based Progressive Livestock had a number of farmers impacted by the cancelled contracts but the end result, while disappointing, has been pleasing, director Andrew Robins said.
Live cattle export is about creating premiums and farmers budgets for that premium.
“Many of the cattle were contracted at $1100 a head but as we all knew they would not fetch those heights in the local market.
“It’s been a monumental task, a huge logistical exercise with all stakeholders cooperating to get this result.”
Robins says it has been a saving grace that the East Coast of the North Island has some feed.
“Given the scale of the exercise – Waikato on the cusp of serious drought, transport logistics making it virtually impossible to get any of the cattle to the South Island – all stakeholders have done their very best to mitigate losses selling to best advantage in a market under serious pressure.”
GDNZ proposes all vendors will get paid an equal portion of the contract invoice that was calculated based on induction weights soon after arrival at the PEI farm, likely to be about 85% of that value.
“We (GDNZ) will pay out $750 a head after the sale and pay the top up balance as soon as possible after dispersal is completed,” GDNZ managing director Dave Hayman said in a letter to clients.
Hayman is seeking legal advice on a claim against the shipping company and says if he gets any settlement then a portion of it will be set aside for cattle payment top-ups to farmers.
