Wednesday, December 6, 2023

SFF forecast underscores sheepmeat woes

Neal Wallace
Farmgate forecast substantially down on last year’s average.
Pāmu manages more than 100 farms, totalling close to 360,000ha and spanning sheep, beef, dairy, deer, forestry and horticulture.
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Warnings of a significant drop in new season pricing for sheepmeat have materialised, with Silver Fern Farms forecasting farmgate lamb prices of between $6.90 to $7.30/kg  through until December.

Programme premiums will be an addition to that, but this forecast is substantially below last season’s industry average open price of $8.74/kg and reflects current weak international demand and prices, and Australia’s flooding of markets.

Forecast mutton prices are $3 to $3.80/kg, well back on the five-year average $5.65/kg and reflect the same weak international markets, especially China.

Beef and venison are looking more optimistic, with prime beef opening season prices of $5.30-$6.30/kg, bulls $5.20-$6.20/kg and cows $3.60-$4.30/kg.

Venison prices are $8.70 to $9.20 with chilled at $9.75-$10.30/kg.

Silver Fern Farms (SFF) chief executive Simon Limmer told suppliers in a newsletter that there are challenges across all markets from low demand, high inventories, and increased production out of Australia and Brazil in particular.

“We’re cautiously optimistic prices have bottomed out for beef, but things are still very challenging for lamb.

“Our forecast pricing reflects where the markets are at right now, however we are suffering somewhat of a perfect storm and we are experiencing quite a correction.” 

Limmer remains optimistic that underlying demand for red meat protein will continue to grow over time but the recovery, especially for lamb, is dependent on China.

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