The latest weaner calf price dropped sharply last week by 2.5% to R31.29 per kilogram, and is now roughly at the same level as a year ago, maintaining the trend we saw in 2018. This year, the price is about 7% lower than what we saw in 2018. Unfortunately, this puts a lot of pressure on the profitability of the industry with input costs naturally much higher than what we saw 6 years ago. If we do follow the 2018 trend further, we should see sideways prices until mid-July, after which we can expect better prices until mid-August. The price in Mpumalanga also dropped sharply to R31 while the price in the Western Cape remained sideways also at R31.
The A2/3 carcass price rose to R55.65, with the C-grade price dropping to R42.63 per kilogram. I think the A-grade price can rise further and possibly trade just below the R60 mark in September and October, while it seems the C-grade prices may stay between R42 and R43 until then.
In the sheep market, the feeder lamb price increased by almost 2% to R41.59 per kilogram, which is now about 2.2% lower than a year ago. Currently, there is a 94% weekly correlation in price movements with the 2021 season when looking at lamb prices, with the current price more than 12% lower than what we saw in 2021. I think we might maintain current price levels, or even slightly higher levels, until the end of July when we expect the highest price for the year. However, from August, there could again be significant downward pressure in the market. The Central Free State price rose to R42 per kilogram, while the Western Cape price remained sideways at R40. The A2/3 price dropped slightly to R85.45, but it still seems the A-grade price has upward potential. The C2/3 price also rose last week and currently trades at R58.92 per kilogram.
Wool prices in Australia fell by 1% last week, and the sentiment was that buyers are waiting for more supply before making more purchases. Supply at Australia’s auctions is also significantly less, and it seems to me that there is a temporary pause in the market at the moment.
Poultry prices fell last week, with the frozen price at R34.32, fresh prices dropping to R33.51 while the IQF price rose to R29.24. The stronger exchange rate certainly had a negative effect on prices, and it seems we can maintain price levels this week as well. But we are now at the point where we will see a turning point in this market, with fresh and frozen prices traditionally rising from the beginning of July every year. The IQF price, however, may remain sideways until the end of August.
The latest baconer price also dropped last week to R30.45, the porker price remained lower at R31.27, while the latest sausage price sharply fell to R23.84 per kilogram. On a weekly basis, there is now a 90% price correlation with the 2021 season when looking at baconers. Baconer prices reached a low point in mid-August 2021, so it seems there is still downward potential for baconer prices especially in the short term. However, the market sentiment is positive, and we might see a smaller decline in prices compared to 2021.
The latest large goat price rose to R52.67, small goat prices rose by 30% to R64.02, while goat ewe prices rose to R43.36 per kilogram. As mentioned, goat prices should rise over the winter months and traditionally reach a peak by the beginning of spring.
In the feed market, the latest grade 1 lucerne price rose last week to R3350 per ton, with the export market currently very quiet because the quality is not up to standard. However, the domestic quality is very good.
