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NZ Sheep Beef Farm Profits Forecast Higher

27 May 2014
Meat & Livestock Australia

NEW ZEALAND - Beef + Lamb New Zealand’s (NZ) Mid-Season Update delivers a positive story for the NZ red meat industry, as the latest publication forecasts average sheep and beef farm profits to increase 35 per cent during 2013-14 NZ production year October to September.

Analysts at Meat and |livestock Australia said that for sheep, around 25.6 million lambs were marked during spring 2013, down 1.9 per cent on the previous season.

As a result, total lamb slaughter to 30 September 2014 is expected to be 5.3 per cent lower than the huge drought-induced slaughter during the 2012-13 season.

However, this seasons decline in numbers is forecast to be somewhat offset by a 1.9 per cent increase in average carcase weight, to 18.3kg cwt – reportedly the second highest on record.

Furthermore, driven by higher global demand and lower supply in Europe, greater farm-gate prices (forecast to average NZ$100 per head during 2013-14 – up 18 per cent year-on-year) have more than offset lower slaughter.

As a result, Beef + Lamb NZ estimates that farm profit before tax for the 2013-14 season will reach NZ$113,700 per farm – up 35 per cent year-on-year.

In contrast to the drought-induced slaughter and production during 2012-13, this season’s total export cattle production is reportedly estimated to decline 1.1 per cent, to 573,000 tonnes cwt.

A combination of lower supply in the US and greater demand from China during the 2013-14 season has supported higher beef cattle prices.
For the NZ production year-to-date (October to May), monthly steer prices averaged 375NZ¢/kg cwt – 23 per cent higher than the corresponding period last year.


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