This week we see calf prices increasing by more than 6% compared to last week, with better demand and lower supply pushing most prices to higher levels than last year.
Please note that Dr Johnny van der Merwe and AMT operate 100% independently. We don not buy or sell livestock, and can therefore provide an independent opinion on where prices traded in the previous week. Just keep in mind that these are average prices, and each animal—depending on its weight, breed, quality, gender, and age—can achieve a higher or lower price at an auction. Prices at different auctions will also always vary depending on the competition between buyers, so make sure you get the best price on the day that suits your pocket.
Last week, the national average weaner calf price for calves between 200 and 250 kilograms increased by more than 6% and now trades at R37.15 per kilogram. “Out-of-hand” or direct sales are also higher at R36.28 per kg. The average price is currently 22% higher than a year ago. Lighter calves under 200 kilograms increased to R35.90, while heavier calves between 250 and 300 kilograms rose to R35.20 last week. Bull calves jumped sharply to R39.69, with crossbred calves now averaging R36.17. The average price in the Free State rose to R37.77, while the price in the Northern Cape also increased nicely to R35.72 last week. Slaughter prices rose further, with the A2/3 carcass price now at R58.82 and the C-grade price up to R47.99 per kilogram. In the Western Cape, the A-grade price is already at R65, which could indicate that inland prices might also rise.
The sharp increase in calf prices last week, which goes against usual seasonal trends, is a strong indication that supply and demand are driving market prices. The good rainfall means that many producers are holding back. In fact, I believe demand is starting to pick up because there’s now good grazing. In last week’s episode, I looked at previous years with similar calf price trends and saw that 2017 had a very similar pattern. If we follow that trend further this year, calf prices could rise now and remain above R40 through the winter—but that’s not the only factor influencing prices. I still feel that increased supply in May and June could put some pressure on prices, but it’s going to be an interesting year.
We are, however, seeing that lamb prices are following seasonal trends, with the average feeder lamb price rising to R42.56 last week. Slaughter lamb prices rose to R43.41 per kilogram. Direct feeder lamb prices also increased and traded at R42.44, while direct slaughter lamb prices dropped to R42.90 per kilogram last week. The average feeder lamb price in the Free State dropped to R43.06, while the price in the Western Cape is at R43.69 per kilogram. The average lamb price is now around 16% above last year’s levels and could trend further upward as we head into the winter months.
Slaughter prices are moving sideways, with A2/3 at R100.44 per kilogram and C2/3 prices rising to R65.34 per kilogram. Forecasting models suggest that we could still see support in A-grade prices until the beginning of July, while C-grade prices may decline.
Wool prices are rising further, with the RWS clean wool price at R189.31 per kg and non-RWS wool also up to R184.80 per kilogram. Wool prices in Australia increased by 0.3% to an average of AUS $12.49 per kilogram. The sharp weakening of the exchange rate pushed prices up sharply last week and may keep them elevated this week too.
In the poultry industry, frozen prices increased by more than 1%, and the weaker exchange rate should also keep prices high. Frozen ex-abattoir is at R34.86, fresh prices at R37.14, and IQF remains at R33.96 per kilogram.
Baconer prices are holding current levels, with the latest baconer price at R32.64. Meanwhile, porker prices increased to R33.23, and the latest sausage pig price rose by 1% to R25.70 per kilogram. Traditionally, prices tend to dip a bit now due to lower demand after Easter, but tight supply may counteract that, and we may rather see sideways prices until the end of July.
The latest large goat price increased to R40.24, small goat prices rose to R55.16, medium goats to R51.83, and ewe goats to R47.06 per kilogram. Prices are expected to remain volatile from week to week but are moving into a generally upward trend as we enter the winter months.
Lucerne prices are rising due to the heavy rains and reduced availability. The latest average Grade 1 lucerne price is now R3400 per ton, premium lucerne at R3900, and Grade 2 lucerne has increased to R2900 per ton.
Demand for chop is picking up due to fewer milling days, which resulted in lower supply, and feedlots are starting to build stock for the next 3 months. As a result, prices are responding upward and now trade at R3550 per ton.
