THOMAS Foods International has released its summer forward lamb contracts, with farmers quick to lock returns in.
TFI was the first major processor to come out with contract prices on Tuesday last week, and national small stock livestock manager Paul Leonard said he was pleased with the response.
“We have had very good take-up, with most weeks now closed,” he said.
The same pricing was offered for deliveries to both Lobethal and Tamworth, NSW.
Crossbred lambs at between 18 kilograms and 32kg carcaseweight delivered in December will make $7.50/kg, January delivered lambs attract $7.80/kg and February deliveries rise to $8/kg.
Merino prices are 30 cents/kg less than the crossbred prices.
The strong prices are similar to those offered at the same time last year.
Contracts for February have been particularly popular.
“We effectively closed the four weeks of February off within 36 hours of the contracts being released,” Mr Leonard said. “Obviously producers thought that was good money.”
While there were slots left for deliveries at Lobethal, Mr Leonard said spaces had been filling quickly.
“At the moment, the first three weeks of December are closed, but there is space available for December 27 and 28,” he said.
The space for January 14 to 18 had also been filled.
Mr Leonard said the February contract had attracted especially good interest from the Mid North and Eyre Peninsula regions.
The December/January spaces would be predominantly filled by sheep from the South East, particularly from Naracoorte across to Horsham, Vic.
“I expect Lobethal contracts will most likely be closed by the end of this week,” he said.
Mr Leonard said while there had been strong interest in the south of the state, the uptake in the north was not as high as expected.
“In the north, people haven’t had enough rain to finish the lambs off on the pastoral feed,” he said.
“If the season continues to improve through December and the new year, and there’s the interest up north, we may reconsider our position and offer forward contracts, mark two, for the north.”
With rain falling across many regions in the past week, Mr Leonard said the company would be assessing its position at Tamworth going forward.
“There is still concern about what happens if there isn’t further rain and if people will be able to finish their lambs off, particularly with the price of grain and access to grain,” he said.
With attractive forward contracts on offer, prices at SA saleyards have also risen.
Elders Dublin/Yorke Peninsula livestock manager Matt Ward said with restockers knowing the price they would receive going forward, it added extra confidence to the market.
“The forward contracts released last week spurred interest from restockers, who put a $5 floor in the market at Dublin,” he said.
Prices were generally up across the board, with heavy, new-season lambs $10-$15 dearer, heavy trades were up by about $10 and light trades rose $10-$12.
Mr Ward said while new-season prices had dropped to $6.80-$7/kg in recent weeks, this week they were in excess of $7/kg, with a few pens close to $8/kg.
Meanwhile, prices were also up by about $5 at Naracoorte this week, on the back of $15-$20 gains last week.
JBS was also approached to comment on its contracts.