Meat And Wool NZ Must Investigate Lamb Prices

Thursday 8 Apr 2004 Gerry Eckhoff

Press Releases - Rural

ACT New Zealand Rural Affairs Spokesman Gerry Eckhoff today urged Meat and Wool New Zealand - seen by most producers as an "independent referee" - to investigate the disparity in lamb and beef prices between the North and South Islands.

"The law of supply and demand appears not to be working in the South Island lamb processing industry. The industry seems to be refusing to compete for stock and is happy to sit out the `withholding period' as farmers hold onto their surplus lambs, seeking a higher price and heavier weights," Mr Eckhoff said.

"The exodus of over a million lambs to the North Island, during the summer drought, has cost many lamb producers dearly. Most are now holding stock due to favourable autumn growth. Processors appear to have no intention of accepting the law of supply and demand by paying increased prices in the South Island - where there has been a huge reduction in lamb numbers.

"In reality, South Island prices should be rising significantly. North Island prices are constant, despite having an extra million South Island lambs to process.

"The exchange rate has impacted on the value of lamb, but that applies to both islands. It is galling for South Island lamb producers to see a differential of $7.16 being paid in favour of North Island lamb - during the 2002/3 season - being ignored by Meat and Wool New Zealand.

"The cartage of lamb is also paid by North Island works, so the disparity between the two islands is close to $9 per head, according to figures available in farming journals," Mr Eckhoff said.

ENDS

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