Meat co-op dilemma
Meat processor Alliance Group's cash-strapped farmer shareholders face a dilemma - either pour more money into the co-operative or risk losing 100% ownership and control.
Heather Stacy, Alliance’s general manager livestock and shareholder services, told a recent meeting of shareholder farmers at Little River, Banks Peninsula, that prime beef prices should remain similar to last year at $5.00 - $5.40/kg early season and $4.80 - $5.20/kg post-Christmas.
However, she says bull and cow prices are under pressure and softening compared with last season. These are projected to be about $4.00 - $5.00/kg early season and $4.70 - $5.00/kg post-Christmas.
Stacy was outlining the farmer-owned co-op’s forecasts during its annual roadshow in which senior executives travel the country, updating shareholders on the co-op’s business.
Stacy says cattle give the co-op the most cause for caution.
“The influence of global supply out of Brazil, the US and Australia is having a downward draw on prices,” she told shareholders
“There is a misalignment between what we are capturing out of the market and an overheated livestock market in New Zealand; so that is where we are counselling caution.”
Forecasts for lamb were $5.70 - $7.00/kg early season and $5.50 - $6.00/kg post-Christmas. For sheep, Alliance is predicting $4.05 - $4.20/kg and $3.50 - $3.75/kg.
Stacy says demand for venison is very strong, but a risk exists that its high price on restaurant menus will prompting diners to substitute other meats. Venison forecasts were $9.85 - $10.20/kg and $9.00 - $9.30/kg.
