Trade Talk by Chris Jones
5th August 2016
This year has certainly put the life back into the livestock auction business.
Recent years have seen increased pressure being put on markets as numerous firms have asked farmers to sell fatstock direct in an attempt to remove their buyers and support from the competitive auction system.
As a dedicated auctioneer it is clear the results of which have put extreme pressure on our business and helped to de-value the stock being produced and create a position where farmers have become price takers with no control over their returns.
However this year has witnessed a marked turn around for both auctioneers and farmers with many producers fully appreciating the benefits that the auction system can provide. Most firms have been forced back to the markets to acquire stock, especially lambs and it is encouraging to report increased throughput coupled with an overall average of 193p/kg for lambs through July, and it looks very encouraging for the autumn as store lamb buyers enter the market.
Prices for store cattle have also improved and in general throughout the spring every vendor has been encouraged by demand for their cattle with the best bred types regularly making 240 - 250p/kg for steers or heifers at around 400kg, while the stronger cattle have been easily sold making up to £1370 for steers and £1360 for heifers in the stores at Brecon on the 29th July.
We do expect numbers for stores to tighten in the autumn as many producers have taken advantage of the strong trade in the spring and sold cattle younger rather than graze them. There is increased demand for breeding stock and it would seem that the national suckler herd may be increasing as cattle are sold younger to allow more cows to be farmed.
To conclude the future for livestock auctioneers looks far brighter than 12 months ago, with more people using the marketing system that is here to improve your returns and realising that it's the live trade which keeps the dead trade alive.
The basic economics are, the more your stock makes the more we make and that has got to be of benefit to every farmer.