Numbers don’t add up as prices start to level off
AT first glance, the sheep trade continues to push on well, with Kepak Athleague yesterday raising their quote by 15c/kg to €5.20+ 15c/kg QA.
While the headline figure might look good, the reality is Kepak had to add that 15c/ kg to their price just to keep up with the opposition, all of whom were at that level a week ago.
Dawn Ballyhaunis and the ICMs decided to leave their official quotes unchanged yesterday, while Kildare Chilling were not in a position to quote.
So, in effect, all the main plants are on €5.20/kg plus bonuses — Kildare, while not officially quoting would probably find it impossible to dip below that price and hope to source meaningful supplies.
Last week it was the two ICMs who couldn’t make up their minds where they wanted to pitch their price.
In my experience, factories only become reluctant to discuss pricing with the media either when supplies are strong or when they are tight — in each case, they don’t want to overcook the price.
Despite factories claiming supplies are strong, mart numbers are reported as being far from so.
Factories will argue that when the market becomes difficult at the retail side, they sometimes can’t quote for sheep because they don’t know what the margin might be. True, but that never seems to stop them buying. Unlike the farmer, who will buy in hope, factories buy because they know they can make the sums add up.
ICSA’s newly elected sheep chair, Sean McNamara, tells me that €5.55-5.65/kg is where it’s at for lambs, with the IFA’s Sean Dennehy claiming €5.70/kg is the top.
On cull ewes, Dawn pulled their price by 10c/kg yesterday to €2.60/kg.
All other plants continue on €2.70/kg.
Michael Harty of Roscrea and Nenagh marts told me it is noticeable at his sales that numbers are declining.
In certain parts of the country, like north Tipperary, as the responsibility for the farm is being passed from one generation to the next, the decision often made by the younger man or woman is to cull the sheep side entirely and concentrate on expanding the dairy enterprise.
This is a greater loss than is appreciated. Generations of knowledge is disappearing from these areas as the diversity of farming narrows.
It is not the fault of the farming community: every generation has to follow the money.
But will we end up with the only meaningful sheep enterprises restricted to the west and north west, as dairy continues to expand?