Price for two-tooths tops $200

NICOLE GOURLEY 624214603

PRICEY PURCHASE: Mokotua farmer Ray McCrostie bought two-tooths at a Lorneville sale this week, which hit his back pocket hard.

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Farmers searching for breeding stock are likely to struggle as demand has pushed prices for two-tooths to $200 in Southland this week.

At the Lorneville saleyards on Tuesday, prices reached $204. The average for two-tooths last year was about $170.

PGG Wrightson livestock manager Andrew Martin said the cost reflected a simple case of supply and demand and that prices were up because more people were looking for stock than was available on the market.

Two years ago the large number of farm sales and conversions to dairy meant there were about 60 clearance sales in Southland, with an average of 1500 to 2000 sheep for sale at each one.

This meant there was the potential for about 120,000 breeding ewes on offer.

However, in the past year there had been few farm sales or conversions, which meant there was little stock for sale, with only about two or three more sales in the next two months, Mr Martin said.

Meat & Wool New Zealand Southland regional manager Jenny McGimpsey said farmers wanted more stock this summer to take advantage of the lush grass in the region.

Last year the price of lamb was the best it had been in four years, so farmers killed a lot of the ewe lambs to make up for the low income of the previous year's lambs that they would normally keep, she said.

Farmers were now trying to restock their farms and that was also pushing up prices, she said.

Mokotua farmer Ray McCrostie, who bought many two-tooths at the sale, said farmers were retaining their ewe lambs to increase stock numbers.

Woodlands farmer Brian McDonagh, who sold 100 two-tooths at $201 each, said he was absolutely rapt with the sale.

"It all comes down to supply and demand ... " he said.

Alliance Group livestock manager Murray Behrent said if farmers retained ewe lambs, then in the short term it would not be good for exporters, because there would be fewer lambs to kill.

That would drive the export price of lamb higher, but in the long term there would be more animals to process and the market would even out, Mr Behrent said.

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