Lamb kill down but companies confident

The lamb kill hit a hole in March, but southern meat companies remain confident there is enough stock to meet their requirements.

In the year to March 30, the total kill was 14.1%, or 2.5 million, below the same period last year but the kill in the month of March was 28% lower than March last year.

"We've hit a hole," Silver Fern Farms (SFF) livestock marketing manager Grant Howie said.

The season was on track for 6.1 million fewer lambs to be processed this season as forecast by Meat and Wool New Zealand's Economic Service, he said.

Companies moved earlier than normal in the season to align processing capacity with livestock availability, but Mr Howie said SFF expected to have enough stock committed to meet its late and out-of-season requirements even though fewer lambs overall were available.

SFF's winter lamb plan had successfully extended the season, he said, which was also helped by an abundance of autumn feed.

Under the lamb plan, SFF bought lambs and placed them with finishers who supplied them back to the company for slaughter in August, September and October.

Alliance Group chief executive Grant Cuff said his company killed more lambs early in the season than expected, which he said would be felt by lower numbers in April and May.

But numbers available from June to September would be similar to other years.

Because the early-season kill was high, Mr Cuff said some markets questioned if the predicted shortage of lamb actually existed.

With the sudden slow-down in March, Mr Cuff said they were left in no doubt.

"There is no doubt that since mid-March the New Zealand kill has fallen rapidly. The world is aware volumes aren't there as they were in previous years."

Lamb prices would be even better had returns for pelts and wool been higher, he said.

Jonathon and Julie Bennett, the Meat and Wool New Zealand South Otago monitor farmers, have this year averaged $83.85 for their prime lambs at an average weight of 16.9kg compared with $52.03 last year at an average weight of 15.8kg.

Store lamb prices remained high, with some reports of prices averaging more than $80 and others of $3.30 a kg liveweight.

Mr Howie said by increasing chilled markets, virtually all suitable lambs supplied in February were sold as chilled, unlike other years.

In other years, more lambs at the peak of the season had to be frozen.

The company has intentionally chased heavier lambs, offering up to 70c a kg more for 21kg to 23kg lambs than for 15kg lambs, because it has developed products using boned out leg meat.

Looking ahead, the two companies differ on the expected number of lambs available for slaughter next season.

Mr Cuff said ewes had gone into tupping in better condition and there appeared to be a high retention of one- and two-year ewes, ewe lambs and farmers putting hoggets to the ram.

The Bennetts have nearly 800 hoggets, some of which they were considering putting to a ram this year.

Mr Howie agreed autumn conditions were favourable and there would be a higher retention of ewe lambs, but SFF believed another 200 sheep and beef farms would convert to dairying this year which would force a further reduction in lamb numbers next year.

He said forecasts indicate 150 of those conversions were in the South Island.

In addition, North Canterbury and the East Coast of the North Island were dry.

Meanwhile, the South Island beef kill to date was more than double for the corresponding period last year due to a heavier cull dairy cow kill.

Mr Howie said nationally the number of prime steers was back 7.5%, bulls by 10% and deer was between 20% and 25% lower.