Trade Talk - Rugby Farmers Mart

8th January 2016

The beginning of a New Year usually offers a point to draw breath and take stock on the Business for which you are responsible for and look at the way ahead. This for us has had to be put back a little as we held a full sales Calendar throughout a festive season in which we have seen heightened demand in the Sheep and Cattle aisles with Processors reporting a late yet good level of demand for red meats.

The first sale back this Monday the 4th saw 2239 Hoggs sold to return an Sqq of 183.40p/kg topping at £95 which represented a continuation of the upturn in trade seen in the last two weeks of December. 550 Ewes also saw an increased demand with an average of £76 well in line with reports from Asian abattoirs of increased sales during the New Year celebrations.

The Cattle ring also hosted an increased number of buyers with fridges seemingly requiring a refill. As we look back at the previous year we as a business look back at a year that has continued to place strain on both farming and processing customers but in which RFM has seen an increase in sheep numbers of 38% across all sections with the greatest rise in the number of Prime sheep sold, and in Store and Fat Cattle a yearly increase in numbers of 12% (this on top of a total market numbers increase of 40% in 2014). The determinants to these increases are indeed wide and varied and we must as a business look upon opportunities and threats going forward.

Farming clients will no doubt be doing similar analysis of their business and must identify what lies ahead for the commodity they produce. Whilst as a marketing tool we deal daily in Supply and Demand side determinants the influence of the Exchange Rate continues to be at the forefront of our Primestock buyers decisions. Whilst the lamb trade and to some extent liveweight Cattle trade has felt sales benefits as Christmas has continued it is no coincidence that the Sheep trade has remained buoyant at the beginning of January with a strengthening of the Euro against the Sterling throughout the same period of time.

Yes extra demand from Christmas will have been apparent within those countries to which Britain exports 40% of its sheep meat and Scandinavia has started the year with a requirement for our Lamb imports, but all of which require the value of our meat to be competitive when benchmarked to a common currency, usually the Euro. Perhaps due to the Exchange Rate, for much of 2015 this has not been the case. Volatility and factors affecting exchange rates should be monitored by producers when making marketing and stock production decisions. Perhaps the success of our market over the past 12 months is as a response of the live-market systems ability to quickly respond to volatile trade determinants such as the Exchange Rate allowing producers to make conscious marketing decisions.