Competitive keen exporters push up prices

23 Jun, 2010 09:00 AM
A huge crowd turned out to see how high the prices would go at the WALSA Katanning June Special sale last Friday.
A huge crowd turned out to see how high the prices would go at the WALSA Katanning June Special sale last Friday.

RECORD-breaking prices of $157.50 at the WALSA Katanning June Special sale last week showed just how much live exporters were willing to pay to secure export quality wethers.

Before the sale there was some concern whether prices would stack up against last year's lofty heights.

But the bottom line was always about supply: wethers were still high in demand and low in number.

Prices surged to a new record of $157.50 for a line of 504 two-year-old wethers from Ross and Ruth Ford, R&R Ford, Narrikup.

Records also fell in the ewe portion of the sale, with the record price for a winter sale reset at $131.50 for 272 one-year-old ewes, from David and Chris Bolt, LL & P Bolt and Sons, Corrigin.

With wool prices also shooting up by 10c/kg last week and the previous sale averaging $110 a head, sheep producers had every reason to celebrate post-sale.

Meat and Livestock Australia sheepmeat analyst Kara Tighe said the high wether prices were due to the tight supplies throughout Australia.

"We estimate that wether numbers are between eight and 10 million within the national flock and are declining," she said.

"The strong returns for lamb and drought have caused the Merino flock to fall to the lowest level since the early 1900s to 72.7 million head.

"The largest component to fall has been the wether flock."

Ms Tighe expects the strong prices to hold into the winter.

"The market is being supported by the strong demand in the Middle East for both live export and mutton because we've got really tight supplies of sheep supporting the livestock export trade," she said.

"A lot of producers are moving to meat production to diversify and are reducing their wether flocks.

"We expect sheep prices to average above 2009 driven by that tight supply."

Wellard Rural Exports livestock manager (sheep), Murray French, said the line-up at this year's June Special was one of the best he had seen.

"It was a very good yarding of sheep and the prices were stronger because of the numbers of good sheep available," he said.

"There were shortages of wethers with the weight, so the heavier sheep sold extremely well."

All the sheep that were purchased by Wellard Rural Exports are ear-marked for the Middle East.

Another export company glad to see the tens of thousands of wethers in the sale, was volume buyer Emanuel Exports.

The company's livestock sheep manager Mike Curnick, said most of the wethers he purchased would go to Kuwait.

"We were very happy with the quality of the sheep right throughout the yarding," Mr Curnick said

"Those older wethers aren't in the system anymore: farmers are selling them as lambs so nobody is carrying the older wethers through, which is why there isn't many of them around.

Livestock Shipping Services sheep buyer Chris Medcalf said most of the sheep purchased by LSS will be going to Jordan after a short stay in the feedlot.

"Receivals are now and through to mid-next week, then the boat will load several days later," he said.

Mr Medcalf said the June Special was unlike any other sheep sale for its quality lines.

"We're still buying consistently but we always try and support the June sale each year to help the agents as they support us 12 months of the year," he said.

"We also support the vendors who prepare their sheep for the sale and most of the sheep presented very well.

"Vendors have spent money on them by feeding them grain and keeping them in the right condition for the live export and processing trade, so they should be rewarded."

Mr Medcalf said the prices were as LSS expected.

"There was some good money for the better end of the younger sheep especially the ones which were grainfed," he said.

"There were lighter sheep and mixed sheep that I think still made good money.

"LSS stayed to a quality and weight range and to a price: that's where we were at the day to keep our overseas customers happy."

Elders Katanning territory sales manager Jarrad Hubbard organised the sale on Elders' behalf and was very happy with how it went.

"There's always top quality sheep in the June Special sale and I think the values reflect the quality," he said.

"The live exporters were very active with the exception of six lines of sheep that went to graziers.

"The market continued to strengthen, which is good because it will encourage breeders to stay in sheep."

Landmark livestock manager Eric Broad said the sale produced top values for Landmark clients.

"It was an excellent sale yet again and the quality of sheep was outstanding and the values indicated that at the end of the day," he said.

"Prices were on par with what we expected, probably a bit better."

Mr Broad hopes the good prices will get producers interested in growing out wethers again.

"Everybody's talking about the re-building of the flock," he said. "I'm still pretty concerned that we've seen this decrease in the flock."

"The sheep industry is a good spot to be and having sheep in a rotation with cropping enterprises is very worthwhile."

Sale Summary

Yarding: 35,475 (27,335 in 2009)

Wethers: Sale average $127 ($17 higher than 2009)

Ewes: Sale average $103 ($40 higher than 2009)

Total gross: $4,488,153 ($1.7 million higher than 2009)



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