INSATIABLE demand from China for dairy heifers, coupled to a fiercely competitive procurement environment, is driving prices for export animals to near-record levels.
Some agents are reporting prices as high as $2200 for registered mated Holstein heifers while weaned Holsteins, weighing between 200 kilograms and 220kg, are fetching up to $1800.
Close to farmers' minds will be the events of early last year when the dairy heifer export market crashed almost overnight after agents were paying what some called "unsustainably high" prices.
But the market seems to have returned to those lofty heights, with ready-to-mate commercial unregistered Holstein heifers fetching up to $1600.
Companies such as Elders, Dairy Livestock Services, Landmark Global Exports and Total Livestock Genetics, to name a few, are all actively chasing export heifers.
Elders International procurement manager Scott Altschwager said the dairy heifer export market was a very strong environment at the moment.
"Getting access to cattle off the back of the outlook for milk production is creating an environment where people are tending to retain young heifers rather than consider export markets," he said.
"We have recently finalised a shipment into quarantine and released a new order for unjoined registered Holstein heifers for a shipment to China, where we will be paying up to $1800."
Mr Altschwager said the company had just completed a purchase order in which they procured joined and unjoined Holsteins, Jerseys, and even some crossbreds.
While there was a lot of interest from China, Mr Altschwager said he had fielded enquiry from a number of other regions.
As to how long such high prices would last, Mr Altschwager described the situation as "unchartered territory".
"Historically, when we have approached levels like this, there has been some pushback from international customers," he said.
"If history repeats itself, which it normally does, at some point in time the international clientele may look to reduce price offerings or look for alternative options.
"One thing about international markets is you can never be too sure of anything, and I think from a pricing perspective there is greater increased risk in the price coming off than there is to go too much higher."
Landmark Global Exports buyer Allan Peglar said the market was "very buoyant". He expected it to remain that way for at least the next 12 months.
"After 12 months I'm not really sure - nobody has a crystal ball," he said.
"At the moment that's as far as I would predict because we have seen it change overnight in the past.
"The dairy industry itself looks good for the next 12 months but after that nobody knows, and it's the same with dairy heifers."
* Full report in Stock Journal, April 17, 2014 issue.
