Sheep farmers selling out

18:34, Feb 12 2013

Recent sales of capital stock ewes at the Temuka Saleyards has renewed concerns about farmers exiting the sheep industry.

Last week's capital stock ewe sale was the first of its kind at the yards, where 14 vendors sold off their sheep flocks.

The vendors represented a mix of farms, some with small flocks and other larger scale operators. Some of these vendors had also sold capital stock at the two-tooth fair the week before.

Two of the vendors at last week's sale were converting to dairying and the rest were either selling up or changing their farm policy where they would move away from sheep breeding.

Ken Fraser said the state of the sheep industry was a factor in the decision to sell Opuha Downs, the farm that he is an equity partner in.

"That was some of the reasoning. It's not looking up. That and we were approached with an offer."


Fraser said it was bittersweet watching the sheep flock sell under the hammer. While it was sad to see them go, he was delighted with the prices they sold for, with the sheep averaging $119.

"It was a bloody good price. It was a very buoyant market given the current prices for lamb and we were happy."

The industry's poor returns also contributed to Andrew Hayes' decision to convert his Hakataramea farm to dairying.

He sold off his flock at last week's sale.

The property had been in the family for 130 years, running sheep and beef all of that time. He took over the farm via succession in the 2009-2010 season.

"We only bought the place three to four years ago and we gave it three years to see how it went."

Dairying was inevitable to make the costs associated with irrigation pay, he said.

The sale gave a stark indication of the number of farmers leaving the industry, PGG Wrightson South Canterbury livestock manager Joe Higgins said.

"It just shows you the number of people wanting to do something else because of the way they feel about the sheep industry at the moment."

The sale was held because of the high number of capital stock sheep on the market at the same time.

"We had the opportunity to put them together and have a sale and draw a large crowd."

He said there were a significant number of sheep leaving the province again.

"There could be 20,000 sheep leaving the province this year."

Federated Farmers South Canterbury meat and fibre chairman Neil Campbell said it was a major concern.

"People are voting with their feet. It's got to be concerning for the meat processing industry that already has got excess capacity."

There would continue to be land use change on farmers where it was possible, because of the low returns from lamb. People were finding a more profitable land use in dairying.

He said that the bulk of the sheep sold at the sales would be used for breeding by the purchasers and were not lost to the industry.

He understood many of the sheep sold at the capital stock sale headed to Southland.

The Timaru Herald