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This month porkoutlook contacts indicate prices of some ingredients are stable while there is upward movement in meat and bone meal and blood meal prices. Reported increased demand from Asia is a driver for this, but now the domestic kill is increasing with the ‘cull cow season’ underway the volume produced will increase. The tallow price for one supplier has eased as well.
North North Island: Barley is reported as being “in short supply”, “scarce as hen’s teeth”, with the limited supply coming from the South Island. At this stage there is no real interest from the dairy sector. In the lower North Island, the later harvested crops have had to be dried, with some badly lodged crops being “left in the paddock.” The quality of the later crops has reduced, with some badly sprouted barley having to be sold at discounted prices. This provided a bonus to duck shooters for their dam feeding purchases. Demand continues to be met from the South Island.
South Island: The harvest reported as being safely “in the bin” and steady demand with the reduced supply has resulted in increasing prices. Some demand is coming from the dairy industry where they are securing supply for late winter and early spring. The focus is now shifting to next season with drilling of winter crops delayed by wet ground conditions. Contacts indicate it looks like there is “plenty going in.” On reflection of the 2016 harvest, the estimated total tonnage was 241,200 tonne which was down 12% on last year (AIMI summary). Of this 55% or 133,200 tonne has been sold with the balance of 108,000 tonne remaining unsold. With the carryover of unsold barley of 3,600 tonnes, the estimated total unsold barley is 111,600 tonnes. Sowing intentions from a survey at 1 April, indicate autumn/winter feed barley area is expected to increase by 48% (up 6,800 ha). Another key point is that the carryover stocks of unsold barley are lower than the previous year.
Wheat: At a glance-price creeps up and supply more available
In the North Island, there is a similar situation to barley with supply being met from the South Island. Wheat seems to be more readily available than barley. In the South Island contracts are being offered for next harvest and reports that growers are “stand offish” indicate they have higher price expectations. The estimated total tonnage from the 2016 harvest for feed wheat is 346,800 tonne, which is 18% up on the previous year. Of this an estimated 75 % has been sold. The sowing intentions for feed wheat at 1 April indicate, the area sown will increase by 23%. This is reinforced from contacts who say that “plantings look reasonable,” “but some planting delayed due to wet conditions.” Both feed wheat and barley stocks of unsold grain are reported as being much lower compared to this time last year.
Maize: At a glance–harvest underway a month late. Supply short
The FAR Maize Action publication provides a good summary. The two recent cyclones have caused crop damage and from flooding and lodging of crops, with growers cautioned to be aware of sprouting and mycotoxin damage in these situations. Some paddocks in the Bay of Plenty and mid Waikato have been under water and in other areas ground conditions are very wet causing delays to the harvest. In some areas grain harvesting has commenced but moisture levels have been slow to fall.
Upper North Island: In Northland contacts indicate 35% of the grain harvest is complete with yields reported as variable but average at best. In Waikato harvest delays due to wet ground means that only 10% of the harvest is complete and yields being reported as back 15% on an average year. In the Bay of Plenty, it is estimated that up to 2,500 tonnes of grain are adversely affected by flooding. Harvesting has only just commenced in Gisborne, with harvesting progressing slowly as moisture contents are slow to fall. Yields to date have been 15-20% down from an average season. Further south in Hawkes Bay a similar situation exists, with moisture content slow to fall and too little harvested to comment on yields. On the west coast some harvesting has commenced in South Taranaki, Wanganui and Rangitikei regions with the comment that “not too much harvested yet,” and “yields not great.”
Given the delay to harvest and no carry over of last season’s maize, the supply situation is very tight, with what is described as “a shortage of maize” and “touch and go if we get through to new season maize.” There are reports of some maize silage being carried over and ‘grained’, however the total tonnage will be small and the yields “will not be great.”
Pig meat prices: April 2017
Note: Prices above relate to: Pork D1 class, Bacon H2 class
At a glance – No change in prices, supply continues to be strong
During April the pork price stayed the same. This was over an often ‘tricky’ time of the year with consecutive three short weeks. Contacts indicate that this was due in part to good planning and management as well as some good luck. Comments such as “bit of a battle,” “specials going well,” “demand still a bit too price sensitive,” “imports dearer,” “still have supply pressure,” and “some improved demand,” indicate the fine balance of supply and demand that exists at present. On the international scene, the US pork price is rising with one commentator Jim Long reporting on 8th May, “It’s the month of May, usually from May till September is hog producers time to get higher prices and generally have the most profitable period of the year. Both summer lean hog futures and cash prices have appreciated recently. Average Producers should be at about breakeven right now but at current summer lean hog futures and feed price average producers should have profits of $30 plus per head in the weeks ahead. Better times are just about here.”
Hogsnort shows a little more optimism this month, “with looking at the increased supply and getting through the three short weeks of April and no further price drops, there is some hope for pig farmers. There are murmurings of international pork demand increasing with China again back in the US market, putting upward pressure on the price. The reports indicate a slight increase in import prices which hopefully continues and will give the New Zealand farmer some respite in the local market place.”
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