Rearers look to fill shortage

01-05-2009 | Not Specified

Calf rearers are still facing an uncertain year, after the failure of last year's expected boomer season.

"You would like to think we are finally going to see this hole for young stock open up, after last year's drought and the lack of calves reared last year," says one larger lower North Island rearer.

However, she is concerned buyers may opt for heavier stock now to winter over, particularly given the higher prices autumn calves were fetching this year.

The low early autumn calf numbers have signalled a slow start to calf sales in the upper North Island this season, with correspondingly higher prices than those seen at yards a year ago.

Elders agent for the South Auckland region Kelvin Oppert reports numbers down by a third at early autumn offerings, with only about 200 head presented at late March weekly sales.

"There could be a host of reasons driving it, but we suspect with the drought last year farmers held cows back from mating a little longer to get some more condition on them after a hard year."

However, buyers have been prepared to meet the shorter supply with prices significantly up on last year, with some yardings getting $120 a head.

Last year, early born autumn calves were barely fetching $50 a head, and slid as far as $20 a head with many destined for pet food.

Oppert is confident this can be met at the sale end, with kill numbers for steers and heifers in the North Island 8% up on last year's drought figures, and 14% up on the five-year average.

"We have long been told about this hole in supply looming. The dairy boom last season put it off a little, but the prospects are still there for demand that needs to be met."

He has been fielding phone calls from buyers prepared to pay the higher prices from as far afield as the King Country and Northland.

With a blip in confidence over the dairy sector, he suspects a number of farmers who had taken on dairy grazers last year would be re-assessing where their farming strengths really lay.

"One would hope they are looking at returning to doing what they do well, raising beef animals, and will be needing to get their numbers up."

The improved prospects for the sheep sector could also be an added incentive for central North Island operators to change their livestock mix back towards a more traditional operation after dipping into the dairy grazer sector.

Central Livestock agent Shane Scott acknowledges farmers in the region have noticed a drying up of dairy grazer interest.

"This will inevitably mean a few will have to revisit how they intended to farm and get into the market to buy livestock again."

Long-time Waikato calf-rearer Donna Farrelly says with national kill figures up, supplies of older stock will be running down on a good grass market, hopefully shoring up demand for weaned calves now and late spring.

She acknowledges last season ended up being "a fizzer" due to the drought cutting off demand from traditional buyers who were still struggling to finish stock from the season before that.

She advises anyone rearing this year to consider contracts, more commonplace after last season and some disastrous earlier seasons that ended with rearer numbers dropping due to the uncertainty of final calf prices.

"I am glad we did. We signed on for $400 a head for a 100kg weaned calf, and some buyers even paid a deposit on theirs." She was doubly relieved when she saw prices from late October onwards crash to $150 a head and below.

Farrelly has regularly reared 7000 calves, and believes even contracts at $350 a head are worthwhile, providing calves can be sourced for around $50 a head.

"There is still a lot of uncertainty there around milk powder prices, but you could still work on around $200 a head to rear, plus the cost of the calf."

She jokes that with Fonterra's plentiful supply of whole milk powder it would be cheaper to "buy direct off them" and has heard suggestions prices may drop, but only by $5 a bag to about $80.

"Meal still looks like it will stay high, however, with high protein meal still around $800/tonne."

Rearer Mark Bocock of Cambridge believes a number of cattle farmers will be rueing their decision to opt for dairy grazing, now dealing with cancelled grazing agreements, good grass supply, and having to buy stock to fill the gap.

"You only need to look around the country side to see how empty properties are, with plenty of silage and not a lot of cattle to eat what is there. They will have to come from somewhere or it will be an empty winter."

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