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AUCTIONEERS COMMENT

12 September 1997

AUCTIONEERS COMMENT

MARKET

Cutcombe, Somerset

AUCTIONEER

Peter Huntley (Phillips Livestock)

IF youre planning to sell suckled calves this autumn, dont despair at the prospects for heifer prices.

So says Peter Huntley, who thinks some improvement may be seen for these animals compared with last year.

Cutcombes auction last month, one of the first early-autumn offerings, saw steer and heifer calves average £498 and £300 respectively.

"The big differential resulted from the subsidy payment available on male animals and the premium they can make when sold finished," says Mr Huntley. Theres little scope for any increase in steer values.

"But confidence is growing in heifers, as more are offered with age documentation.

"People have got the message about the importance of Cattle Birth Record Documents – and where heifers have these, this often adds £25 or more to their price."

Many of the entries for Cutcombes coming sales in October and November for the Exmoor Suckled Calf Rearers Association will have been born this spring. As such, they will carry the passports, compulsory for cattle born after July 1996.

"Everyone is conscious of the 30-month age limit on beef entering the food chain, although it probably affects trade for older store animals most.

"Key to the value of calves this autumn will be their quality and its weight. A heifer that is, say, 280kg is probably slightly more saleable than one that is 220kg, because the buyer had got a bit more of a head-start.

"Smaller ones are, however, in more demand than a year ago. Back then, just six months after the BSE revelations hit the headlines, any whisper in the newspapers had an immediate affect on the finished cattle trade, and with it the prices of calves and stores.

"Early signs are that this autumns values are up about £30 or £40/head on then."

Recent months have also seen the second-quality animals become easier to sell as interest has picked up, says Mr Huntley. And with heifers costing less than steers to begin with, there will always be buyers looking specifically for them. "It depends on peoples production systems – some, for example, will take them through the winter and finish them next winter at about 22-months-old."

The subsidy payments on male animals, meanwhile, remain a key determinant of value.

Last months auction saw 330kg steers on blue CIDs make £450, while another of the same weight on a green card – and with another payment due – went for £540.

"Another key requirement of buyers will be consistency. People want to buy bunches of cattle that can be housed, fed and treated similarly and, hopefully, finish at the same time."

Many of the vendors at Cutcombe are selling their entire crop of spring-born calves. Many are Charolais crosses, out of Hereford cross Friesian cows.

"This is why prices in the autumn are so vital, because many farmers systems arent geared to holding on to the calves any longer. Housing might be occupied in the winter with the suckler cows and the sheep."n

Steer prices are unlikely to be higher than last year but heifers could be worth more, says Peter Huntley.

Farmers are gearing up for this autumns big suckled calf sales.

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AUCTIONEERS COMMENT

29 August 1997

AUCTIONEERS COMMENT

MARKET

Taunton

AUCTIONEER

Derek Biss (Greenslade Taylor Hunt)

ANOTHER tranche of dairy farmers will leave the industry this autumn, says Derek Biss of Greenslade Taylor Hunt.

"Many will be smaller producers – with between 50 and 100 cows and followers – who, having hung on through the buoyant times, are now suffering as milk prices fall and costs rise.

"Most will be between 50 and 55-years-old, keen to take advantage of current retirement relief tax provisions.

"It seems possible that these will disappear in the next Budget."

Many of those leaving will not, however, sell their land, says Mr Biss. The proceeds from the quota and the stock will enable them to write off borrowings – and perhaps allow them to continue farming in some other capacity, possibly part time.

"Perhaps running a low input system, winding down to retirement. Some may look to fatten store cattle.

"Others may consider a suckler cow venture which, although badly hit by cuts in OTMS payments, is less stressful than dairying and pays quite well if done right."

The value of the quota will be far bigger than that of the stock. "Although dispersals are usually timed to offer the cows when they are giving the most milk – and farmers take great pride in presenting them well – they are still almost ancillary to the value of quota."

This autumn, therell be a bigger difference than ever in cow values between the best and the rest, says Mr Biss.

A recent weekly dairy sale in Taunton market, for example, saw all 71 animals make either below £650 – or above £800.

"And the demand for milk-and-kill animals – those that could be briefly milked, fattened and then culled at a profit – has disappeared with the present OTMS regime."

Helping put a floor in the market, however, will be the demand from farmers looking for replacements after having animals taken under the selective cull.

"So far, there hasnt been a big impact as most of the people affected have had home-bred herds, with heifers in the pipeline. But as the cull increasingly targets flying herds, more impact will be felt."

Making the most money this autumn will be animals that have low cell counts and have age and looks on their side.

"People are looking more and more for modern-type cows and heifers – ones with good conformation and up-and-under udders."

Also shoring up trade will be the plentiful forage supplies. This has had a big impact on the store cattle and sheep trade as people "buy lawnmowers". So much so, in fact, that prices of store lambs have risen to record levels and there may now be a backlash, with demand switching to dairy youngstock.

"People might buy heifers, put them to the bull, and then sell them next summer.

"If they can be purchased for £400, and sold next year for £650 or more, then theres probably more money in that than store cattle.

"In addition, with large fodder stocks and low quota prices compared with 12 months ago, many committed dairy farmers may buy cows and heifers and source quota in an attempt to maintain profits by milking more animals.

"The wise men will buy cows now and then sit and watch the trade for cows and quota rise in the late autumn." &#42

Large numbers of farmers are getting ready to quit dairying this autumn, says Derek Biss, pictured (with microphone) at a recent dispersal.

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AUCTIONEERS COMMENT

22 August 1997

AUCTIONEERS COMMENT

MARKETS

Shaftesbury and Salisbury

AUCTIONEER

John Bundy (Southern Counties Auctioneers)

WITH the busiest time for trading calves at Shaftesbury and Salisbury approaching, prices look set to ease, says John Bundy.

"Early October will probably see most bull calves changing hands between £85 and £180, with only the best over £200. Continental breeds at the top of the range, Hereford and Angus at the bottom."

Heifers will remain harder to sell. "There is no slaughter scheme to put a base in values, and farmers have been wary of buying them, with finished prices in the doldrums and no prospect of subsidy."

But demand has been surprisingly good over recent months, says Mr Bundy. With the best Continentals often topping £200, values are not that far behind the levels seen before the BSE crisis broke.

"The highest prices usually go to an animal old enough so that buyers can see what its conformation is like – typically about 18 days old."

But Belgian Blues calves have suffered in the face of the export ban. In the absence of this market, upon which they were traditionally heavily dependant, they are now making just under, rather than well over, £200.

And the latest reduction in compensation payments to below £83 for dairy breeds and £105 for beef animals has also had an effect on open market trade.

Changes to the scheme will be needed if beef exports begin again, says Mr Bundy.

"While the Germans will prob-ably never again buy British beef in any great volume, other nationalities – such as the Italians – will. So if we are to satisfy this demand, fewer will then need to be killed between seven and 20 days old."

Any lifting of the export ban, meanwhile, would not automatically herald a resumption of the live export movement, says Mr Bundy.

"Exporters will look at the figures to see if they can make money. And this certainly would not be the case if the scheme continues to put a floor in prices where it currently is."

Store cattle supplies are tight. "When yearlings are offered, they make good money."

Two batches of Friesian steers on green CIDs went through the ring at Shaftesbury recently, making £350 apiece.

"They were born just before the introduction of the calf processing scheme. The alternative to keeping them for rearing was selling them on the open market, probably for about £25."

The better store business has, meanwhile, prompted more heifer marketings, says Mr Bundy. A lot have been retained by farmers who were discouraged by low prices but had plentiful keep supplies.

"If you can make £300 for a yearling heifer, then with no subsidy available, it make sense to sell it now."

And those looking for calves and young animals, meanwhile, will have plenty to choose from later this year, with a series of suckler herd sales planned.

"The autumn and early winter is a good time to hold a dispersal as farmers may be looking for stock to fill their cow quota allocation," he says. &#42

Calf prices seem set to come under further pressure this autumn.

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AUCTIONEERS COMMENT

28 March 1997

AUCTIONEERS COMMENT

MARKET

Northampton

AUCTIONEER

Keith Rose (Northampton Livestock Sales)

FARMERS need to improve cattle condition if margins are to be safeguarded, says Keith Rose.

"Too many under-finished animals continue to be sold – particularly heifers.

"With cattle birth document records still a rarity, dentition remains the main ageing method. The moment the third tooth cuts the gum, they are excluded from the human food chain and go on the slaughter scheme at 69p/kg.

"Hardly surprising, therefore, that people are tempted to sell them early. Even with a lack of finish, they can still make over 80p/kg on the open market."

It is a problem which looks set to continue until about Christmas, says Mr Rose. By then, the bulk of heifers marketed will have been born after July 1996 and will, therefore, carry a passport.

"Under-finishing is less evident with steers. Farmers can confidently delay selling them right up to the eve of their 30-month birthday, because male animals tend to have proof of age on their CIDs."

One solution, says Mr Rose, is to keep in touch with your market.

"Many offer a free on-farm advice service, with staff coming out and looking at stock and recommending the best time to sell them.

"They can also keep you briefed as to what type of beast is likely to be in most demand at any one time. Different buyers have different requirements – and on any one day, the mix of buyers will vary.

"Ask your auctioneer who is likely to be present at a particular time, allowing you to present stock when there will be most interest in it.

"Local butchers, for example, want the small handy-weight heifers. Medium-sized abattoirs take most stock, as long as it is not too heavy. And the large abattoirs, selling to the supermarkets, will avoid the too lightweight animals, concentrating, perhaps, on heifers around 500kg and bullocks around the 660kg mark.

"Buyers generally want a U or R conformation carcass. Anything that achieves that will generally top the 100p/kg level.

"The ideal weight is up to 640kg for a bullock and 540kg for a heifer.

"Remember, however, that buyers also discriminate against over-finished animals. They dont want to have to do too much trimming."

This need to sell cattle early has ensured that only a handful of those going on the cull collection scheme at Northampton are prime bullocks or heifers. Most are old, cull cows.

Last week, for example, of 35 head, there were four over-age bullocks and half a dozen four-tooth heifers. Rather different to last autumn, when the scheme throughput was at a peak of about 130 a week, of which most would be over-age prime beasts.

The fixation with age, meanwhile, has permeated the store trade, too. "The number of teeth of every female sold is announced: those only showing their calf teeth make a premium, as do those that show a half-decent level of finish.

"At this time of year, buyers get nervous if they see a store bullock which looks as if it needs all summer to finish and it is already 26-months-old."n

Teething problems…although entered for the cull scheme, this heifer, under the dentition rules, was found by Keith Rose to be saleable on the open market which could mean 20p/kg over the scheme price.


Advice from Northampton

&#8226 Dont hang on to cattle, hoping for a shortage

&#8226 Pay close attention to stock condition

&#8226 Speak regularly to your auctioneer

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AUCTIONEERS COMMENT

28 February 1997

AUCTIONEERS COMMENT

Simon Pallett

(Dreweatt Neate, Newbury)

EVERYONE has heard of the pig cycle, but just as evident is a straw cycle, says Simon Pallett of Dreweatt Neate.

On offer at next weeks (Mar 6) forage auction at Newbury is almost 4000t of forage, nearly twice the usual amount. It was a similar story in January, when 6000t was catalogued.

"Large areas of straw were baled last summer," says Mr Pallett. "It was the result of the high prices in the previous year when at a yield of, say, 2.5t/ha (1t/acre), barley straw was adding £125/ha (£50/acre) to the gross margin.

"The large acreage baled last summer, together with high yields, left barns full. Before long outside stacks began appearing, particularly of wheat straw."

Then came the BSE crisis. Farmers have bought on a hand-to-mouth basis; dealers have been less bullish. Much of the winter is over and large quantities remain unused.

Such factors will discourage farmers from baling this year, says Mr Pallett. "Higher fertiliser prices may also encourage them to chop and incorporate, helping to reduce input requirements.

"If people cant get the price they want, they will save it and chop behind the combine this summer."

And if yields are disappointing, we could soon be back in a shortage situation, he says. But those left with straw stacked outside are in a difficult position. "With the exception of the small amount useful for mushroom composting, most is unsaleable. For this reason we have not included any such entries in the March auction."

Despite the straw cycle, there should always be some profit for farmers making small bales of good-quality barley straw.

"And the discount associated with big bales has become less marked as more farmers are able to handle them. Square ones remain far more popular than round ones, as they are easier to stack and move."

Overall this season, barley straw in small bales has been steady at about £35 to £40/t (£25 in big bales), says Mr Pallett. Wheat and oat straw has been changing hands for about £10/t less.

Hay, meanwhile, has been about £100 for farm use, with horse feed samples making over £120/t.

Horse owners are an important feature at the Newbury sale. They take bedding straw, too, preferring long samples, avoiding that which has passed through an axial flow combine.

"Most forage is headed for Wales and the West Country. Samples located on the west side of the Berks/Oxon/Hants/Wilts counties from where the entries come, typically make the highest values, therefore.

"It might cost £15/t to take hay to Cornwall. There is the time element, too. People want to drive to the farm, load it and get home in a day. Overnight stops add time and cost."

With cattle in such areas possibly housed until late April, the weather – and expectations about it – are now crucial to the prices for the rest of this season, says Mr Pallett. Overall, he reckons prices at the coming auction will be similar, or slightly down, on the January offering.

"People certainly wont be buying speculatively. Farmers will be buying forage to use it fairly soon, and dealers will be filling orders."

Of the 70-plus people expected to attend the auction, a handful will be vendors. Paying between 5% and 10% as commission to sell it, they will be keeping their fingers crossed, keen to see it make a good price.n

Simon Pallett: Outside straw stacks are virtually unsaleable.

The next question is how much will farmers bale this summer.

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AUCTIONEERS COMMENT

7 February 1997

AUCTIONEERS COMMENT

Alan Lane (Frank R Marshall)Chelford, Cheshire

GAZUMPING and gazundering are terms which, to many, are associated only with the housing market.

But such practices can also be a problem in private treaty milk quota deals, according to Alan Lane.

And this, he says, is one of the main advantages of leasing quota by auction.

"On the fall of the hammer, the deal is done. The lessee signs the cheque, the transfer forms are completed and the paperwork is sent to the Intervention Board.

"With a private treaty transaction, it can take two weeks after the initial agreement for the money to be exchanged. So if prices rise in this period, there is the temptation for a prospective lessor to pull out and find a better offer (gazumping).

"And the opposite (gazundering) can be a possibility when, in the face of rapidly falling prices, the lessee decides not to go ahead."

The temptation is most evident when quota values are volatile. "There have been times when they have been changing a penny a day," says Mr Lane.

"There is little that can be done by the aggrieved party. Legally, it is a complex issue. And lawyers are expensive."

While the deal is done at the fall of the hammer, auctioning quota differs slightly from selling farm animals or property because the Intervention Board has to ratify the transaction. It is, therefore, a "conditional" contract that is initially made.

"Although it is very rare, a problem could arise if someone tries – either deliberately or inadvertently – to auction quota they do not possess.

"Lessors may register quota with a number of agents and, at any one time, not be exactly aware of exact amounts and the progress of transactions.

"In such cases, the Interven-tion Board acts as a safety net, although the lessee is protected, because the auctioneer holds the money on his behalf until the Intervention Board confirms the transaction has taken place.

"Another advantage to the auction method of leasing is the large amount catalogued, allowing people to pick and choose lot size and butterfats."

During 1996, the largest sale at Chelford was at the beginning of the milk year in April, when 3.5m litres was entered. In fact, over 90% of the leasing the company does is by auction.

"The key to any successful auction is having more demand than supply. With Cheshire a strong dairying area, theres never any shortage of interested faces ringside.

"And farmers, accustomed to trading livestock by auction, are comfortable with the idea of sourcing quota by the same method.

Telephone bidding

"There is telephone bidding, too, popular among those located outside an 80-mile radius. Over one-quarter of the volume leased at Chelford heads outside the area, including some to Northern Ireland.

"Commission bids are also accepted, when a member of our staff – acting as the farmers agent – bids on behalf of someone who has told us in advance what they want and the maximum price they are prepared to pay for it.

"As the auctioneer, however, I never execute the commission bid myself."

It is unlikely, says Mr Lane, that farmers will get carried away by the atmosphere of the auction and pay more than they otherwise might have done.

"Most have a prior indication of price trends from previous sales or by phoning agents before they come to the market.

"After the event, many other agents phone us, checking on price trends. They see the auctions as a good benchmark, just as deadweight buyers view liveweight markets."

Auctions, however, are not the favoured method for selling or buying quota. Such transactions, linked to land, are far more complicated than leasing.

Mr Lane plans to hold his next offering at Chelford in April. "Even if the selected cull gets under way in the current milk year before the end of March, and leasing is allowed for those losing cattle, it is unlikely that enough will be traded to justify an auction," he concludes.n


AUCTION LEASING


&#8226 Large volume on offer.

&#8226 Range of butterfats/lot sizes.

&#8226 No gazumping/gazundering.

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AUCTIONEERS COMMENT

31 January 1997

AUCTIONEERS COMMENT

WHEN Clive Norbury brought the hammer down on the last lot at the Charity herd sale in Cheshire recently, it marked the end of the largest dispersal ever seen in the UK.

Despite the cost of quota, and on-going genetic improvements which mean ever-fewer cows produce ever-more milk, the big herds continue to get bigger.

"This means dispersals of between 200 and 300 animals are fairly common.

"But with 1500 head on offer, the Charity herd of Holsteins, presented particular challenges."

Established in 1992, when 1000 animals were imported from Holland, the cows and heifers average yield was 8206kg at 4.04% butterfat and 3.28% protein, returning a margin over purchased feed of £1600.

And all three of the milking units into which the herd was split ranked in the UKs top 13 herds for ITEM.

Impressive figures, indeed, but such high-performance stock does not appeal to everyone.

So "saturation" of demand was a potential problem, according to Mr Norbury.

"This situation wasnt helped by the huge number of animals going through the ring.

"The event was on a tight timetable, too, with the vendors keen to complete the whole dispersal in the four-month run up to Christmas.

"Ideally, we would have spread it over a year, selling the milkers in three equal groups, on each occasion offering those that calved in the preceding quarter. Maximising, therefore, the value of each beast."

Originally it was decided to divide the process into four separate offerings, the final one cataloguing the youngstock. This last auction was, however, later split into two.

"Chiefly because it was the middle of winter and, if we had tried to sell them all in one day, we might have run short of daylight."

The gaps between sales were designed to give sufficient time for the practicalities.

Dispersals involve a lot of on-farm planning. "There were catalogues to be prepared, as well as the sufficiently broad advertising and publicity campaign a sale of this size demanded."

Spread over such a long period, the sales reflected the ups and downs of what was a volatile period in the dairy industry.

At the time of the first event, for example, barreners were log-jammed on farms around the country, and cashflow difficulties were widespread in the wake of the BSE crisis. Auctioneering was, according to Mr Norbury, "very difficult".

A slight improvement was evident the next time he took the rostrum, but it wasnt until the November auction – when confidence was returning to the sector – that values really improved. Up £400, on average.

"The saturation of demand proved to be an unfounded worry. And in the end it was the herds impressive index figures – supported by production data and, of course, good eye appeal – which was key to generating the interest."

People came to bid, not just to look, says Mr Norbury. At the first three, those there were "looking for milk", whereas at the last two, the ringside was occupied by farmers keen to develop their genetic base.

And bid they did, with a total of over £1.12m grossed.n


Charity dispersal

Average prices:£/head

Sept 16: Cows/heifers825

Oct 8: Cows/heifers870

Nov 4: Calved cows andin-calf heifers1219

Dec 3: Served/maidenheifers854

Jan 13: Maiden heifers737

The herd had good index figures, production data and eye appeal.

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AUCTIONEERS COMMENT

29 November 1996

AUCTIONEERS COMMENT

MARKETHatherleigh, Devon

AUCTIONEERAndrew Lane (Vicks)

ENTRIES at primestock shows this Christmas will be down on last year, says auctioneer Andrew Lane. The BSE crisis, hardly surprisingly, is to blame.

"Among the 600kg-plus heifers, there were traditionally a lot of three- or four-tooth beasts, which are now excluded from going into the human food chain. Similarly, some of the bigger unhaltered steers would have been at, or over, 30 months of age, also excluding them."

The cull cow class will be absent at shows, too. "In the past, we awarded top honours in this section to the animal which made the most in the commercial ring. Again, the over 30-month cull has rendered this an irrelevance.

"All the cows will come joint-first this year, at the compensation price of 72.9p/kg."

While committed "showmen" will still enthusiastically support primestock events, farmers that tend just to earmark one or two of their best animals for special treatment may have decided against it this year, thinks Mr Lane.

"BSE has dampened peoples spirits. And farmers are bogged down with ever-more paperwork, putting further demands on their time.

"Back in August and Septem-ber, finished cattle prices were not high enough to justify giving the time and money needed to halter-break and feed special rations to their best cattle."

But this is changing with cattle prices now improving. "By Christmas, commercial steers could be back at about 115p/kg, where they were 12 months earlier. The premium commanded by show-type animals would put these steers at between 125p and 165p/kg, with heifers at 130p/kg-plus.

"Buyers are prepared to compete hard for such stock, which is well-fleshed and shows a good killing-out rate, sometimes over 5% above the norm.

"Those eligible for the highest honours will be well finished, with no waste and plenty of meat on the hind quarters. They must also have sufficient finish over the ribs and shoulders," says Mr Lane.

Contenders stand out from the time they are born, he says. "At our suckled calf sales, we encourage people to pick out their best and sell them individually as potential show animals.

"At the autumn sales, calves which might be shown the following Christmas can make £100 over the norm, even though they are only 200kg to 350kg. And at the April Fair, where 12- to 15-month-old animals change hands, beasts destined for showing about eight months later, are often worth £1000, compared to the average of £600 or £700."

As for the value of a primestock shows champion and reserve, prices really can go sky-high, says Mr Lane.

"Local butchers compete for them, because they know local people like to buy them. People get very parochial, with real prestige attached to buying – and ultimately eating – the winners. Christmas shows have been pioneering regionally-branded meat for years.

"They also attract a selection of turkeys, ducks, chickens and geese. Although at the time of our event on Dec 9, it is still early for Christmas poultry, caterers and hoteliers will have already begun Christmas menus.

"Regardless of the troubles in the beef industry, the event will generate a lot of good-hearted rivalry and be a lot of fun," says Mr Lane. "And there is no better way of rounding the day off than with a dinner and dance."n

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AUCTIONEERS COMMENT

20 September 1996

AUCTIONEERS COMMENT

With the autumn round of second-hand machinery and equipment sales under way, demand is buoyant. But there are downbeat factors on the horizon, too…

CONTINUING prosperity in the arable and dairy sectors is fuelling interest, says Michael Hamilton of Cheffins, Grain and Comins.

"Good harvests have led to the anticipation of strong cashflows. And demand for the right machinery will be as strong as ever in arable areas."

By "right", he means kit which is well-maintained and is one of the popular makes.

As for the older machines of little interest to UK farmers, the export trade will underpin the market, he adds.

"But there have been some disappointing harvests from late-drilled and spring-sown crops," points out Mr Hamilton.

"And the mood now is that the best years are behind us in terms of farm income.

"There is also pressure from landlords again this year to increase rents; area aid payments have declined; and rises in variable costs are squeezing margins.

"Less cash may, therefore, be available for investment."

In livestock regions, the BSE crisis will have hit cashflows, too.

Auctioneer Glen Snelgar of South East Marts has also seen "grain money" boost demand. But the BSE crisis may, he says, increase interest in second-hand machinery at the expense of the new.

He also stresses the importance of a products make in determining its second-hand value, citing pasture toppers as an example. They will probably last longer and spares may be easier to obtain if from a well-respected manufacturer, says Mr Snelgar.

But many unrealistic reserve prices are being set, according to Warner Sheppards Paul Fletcher.

A recent sale at Milton Keynes in which he was involved, for example, saw over half of the entries fail to sell.

For two-year-old tractors some people were asking retail prices less 20%, when retail less 40% or 50% would have been more appropriate, says Mr Fletcher.

And unrealistic expectations have also been seen by auctioneer Richard Tasker of Stephenson and Son. But bidding is generally brisk, he says.

Prices obtained at the recent York auction included £3500 for a four-furrow, reversible Kverneland plough. It went to a buyer from Ireland, highlighting, once again, the importance of this market.

"In the case of a Kuhn power harrow and Vicon 3m drill combination, although an Irishman was underbidder, the buyer, at £3300, was an English farmer," says Mr Tasker. And this highlights the twin sources of demand: Dealers and farmer.

"Farmer interest in the sale would have been higher had harvest been completed.

"So holding sales in September can be a gamble in years when harvest is late," says Mr Tasker.

But September and October remain popular months to trade machinery, as it coincides with changes in farm occupation.

And under the IACS system, altering occupation between – rather than part-way through – a cropping year helps avoid any potential disputes over subsidy payments.

There are large number of sales currently taking place, points out Brown and Cos Jim Major.

"The land market is very strong, prompting people to sell up and take advantage of the high prices.

"In East Anglia at the end of September and beginning of October, there could be virtually a sale every day."n

Farmers at a machinery and implement sale at West Lodge Farm, Huntingdon, Cambs last week, where the top price was £35,200 for an F-reg New Holland TX36 combine with 17ft cut. (Henry &#42 Bletsoe and Son)

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AUCTIONEERS COMMENT

16 August 1996

AUCTIONEERS COMMENT

THE balance between arable and livestock – corn versus horn – has always been a fine one. But the BSE scare has changed the equation and many farmers may have kept cattle for the last time.

SO say auctioneers in areas such as East Anglia where beef is for many a secondary enterprise.

"Last autumn people were paying up to £200 over the animals weight for stores. This year they have sold then for about the same value, leaving just the headage payment to cover feed costs," says Graham Ellis, auctioneer at Colchester, Essex. "People will say enough is enough."

The relationship between this autumns store prices and expected values of finished cattle in the spring will be crucial, agrees auctioneer Scott Murray at Stamford, Lincs.

"In the past, people have been willing to pay up to 155p/kg for good suckled calves and 130p/kg for older stores, confident that when sold the next spring or summer, 130p to 140p/kg would be obtainable."

With prime cattle prices currently below the 100p/kg-level, there is just not the confidence this year, says Mr Murray. "Not unless people can pick up stores for about 100p to 110p/kg or less at about the October time."

Although it is a complementary venture, with many cattle fed on straw, the relatively-small contribution it makes to the bottom line will make it very marginal in many instances.

"Not only because of the limited profit potential, but because of the mental anguish associated with the beef business at present," adds Mr Murray.

Buildings, meanwhile, could fall into disrepair. "Many of them have no potential for alternative uses." But dwindling cattle numbers in East Anglia is not a new trend. Barry Hawkins, who reluctantly took the decision to close Kings Lynn mart recently due to the slump in beef business, remembers the situation over a decade ago.

"We used to sell 1000 fat cattle a week in this mart. This fell to 80 head; after the BSE scare it dropped to under 30."

Beef special premium payments are an important factor, notes auctioneer Michael Gamble at Norwich.

Because many farmers keep small numbers and claim on all their beasts (up to 90 steers are eligible), the payment represents an important part of the budget.

And this guaranteed income from the premium may have contributed to the high autumn store prices seen in the past, he says.

"Beef utilises labour at an otherwise quiet time of year. So on smaller units – especially where family labour is not costed – it may be seen a useful enterprise," points out Mr Gamble.

"But this winter, if people doubt whether they will be able to make a minimum of £50 a head on stock, they might abandon the enterprise."

One alternative use for the buildings could be contract pig feeding, which would also provide manure.

But Tom Whirledge, who sells at Chelmsford, Essex, says that there may not be the experience or expertise on the farms concerned to become involved in such a specialist process.

The intervention system has failed to support cattle prices adequately, he says. And unless there is a change, feeders of beef cattle will continue to lose confidence.

The bullish outlook for worldwide cereal prices will be a further contributory factor, although moves to support beef farmers from arable subsidy cuts could alleviate the situation, he adds.n

Graham Ellis: When it comes to replacing stock, people may say enough is enough.

Tom Whirledge: Intervention has not done enough for the market.

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AUCTIONEERS COMMENT

10 May 1996

AUCTIONEERS COMMENT

MARKET

Holsworthy, Devon

AUCTIONEER

John Thornton

(Kivells)

PREPARATION is the key to a successful dispersal sale, according to John Thornton.

"Retirement sales often produce the best results because they can be planned well in advance."

The timing of dispersals is often dictated by when the farm is marketed, says Mr Thornton. And the land is usually offered when it is looking its best, probably in spring or summer.

"April, heralding the start of the new milk year, is a particularly busy time for sales. And the differential between the value of clean and used quota continues to be a major factor encouraging farmers to exit the industry early in the milk year.

"To boost stock prices, calving patterns can be altered if there is enough time. Ideally, as many freshly-calved cows as possible will be on offer. They will have cleansed and will be at peak milk production.

"Autumn calvers sell reasonably well in the spring. But it can be difficult to sell spring calvers in the autumn because their production will be falling and they may be eating into much-needed food stocks."

Presentation is also vital. Stock should be cleaned and clipped. And good health is essential if the animals are to look contented and have shiny coats, says Mr Thornton.

"It may be worth accepting lower margins in the final month or two of production if the improved feeding regime leads to healthier, stronger cattle.

"As many details as possible, meanwhile, should be provided in the catalogue. Buyers need information – and may be suspicious if it is not provided. Individual cow cell counts, for example, should be published wherever possible."

This is one reason why milk recorded herds often make good money, suggests Mr Thornton.

The most recent sale in which he was involved was last Fridays offering of 150 Friesians at Staddon Farm, Holsworthy.

Prompted by retirement, the event saw the fully-costed, milk-recorded herd average £700. Also helping ensure a firm trade was the vendors good reputation for stockmanship.

The sale included a run of good quality first- and second-calvers at between 700gns and 840gns.

The herds average mastitis cell count was 136,000/ml. "Nowadays it should be below 200,000 and ideally will be under 100,000," says Mr Thornton.

"Demand for the older cows – which tend to be the ones with the highest counts – is generally weak at the moment.

"With a backlog of barreners on farms, awaiting the slaughter programme, many farmers do not have the space to accommodate additional cattle. Prices of older stock – fourth-calvers or over – will suffer."

Older cows may not adapt to moving farm particularly well, anyway, suggests Mr Thornton.

"Meanwhile, buyers at a dispersal should study the catalogue well in advance. On the day, they should get to the farm in time to inspect the cows of interest.

"Once the cattle are going through the ring, there may not be time to have a proper look at them.

"Its also worth looking at the type of milking facilities the stock has been used to. Cows can take longer to settle into a new farm if they have to adapt to a new style of parlour, for example."

Time spent preparing for

a dispersal is time well spent, says John Thornton.

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AUCTIONEERS COMMENT

5 April 1996

AUCTIONEERS COMMENT

HAVING risen to record levels in recent weeks, cull ewe prices look set to stay strong, says Michael Powell.

This year has seen the £100-mark topped for the first time. And averages have been consistently above those of 12 months earlier. Last Saturday, for example, trade levelled at nearly £54.

Entries, meanwhile, at nearly 2000, were almost double that of the same week in 1995.

"Some farmers, forced to retain cattle, are selling ewes to ease the pressure on space and fodder stocks," says Mr Powell.

"Cattle would traditionally have been sold at this time to pay rents. With the problems in the beef market, surplus ewes are being sold.

"Farmers have also kept a few sheep in excess of their quota in case of losses – and the high prices are now drawing this stock to market."

Any strong, lean ewes are finding buyers, says Mr Powell. Weight is not too important – as long as the ewe is not too fat.

"Until the recent collapse of the cull cow trade, it was often worth farmers feeding the cow and trying to improve her condition before sale.

"With ewes, however, this is not viable and the timing is either governed by price or by management factors, such as lameness or teeth problems."

April would traditionally have been a month when large numbers of culls would have been sold through Taunton.

"As an early lambing area, many would have been sold after the end of the first retention period, so ewes with lambs could be given priority on fresh grass.

"But the changes to the Sheep Annual Premium Scheme mean many this year will be locked under the single retention period until May 14." Culls were only averaging about £30 through April last year, recalls Mr Powell.

Demand, meanwhile, is home-driven. "Unlike earlier in the year, when some were destined for Belgium and France, they are not going abroad now.

"Although Ramadan influences consumption, demand is not as seasonal as it is for lamb. And it is limited to a relatively small, regular number of buyers who influence the trade.

"It is important, therefore, to use a large market when selling culls because sufficient buyers to generate strong competition will only be attracted if there are a large number of sheep on offer."

A tightening of numbers will now help keep prices firm, believes Mr Powell.

And the good trade bodes well for the summer sheep sales, the main ones at Taunton taking place in June and July.

"In the past, people have sold ewes for £35 and have had to double this to pay for a breeding sheep. The differential looks like being less this year."n

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AUCTIONEERS COMMENT

8 March 1996

AUCTIONEERS COMMENT

MARKET

Cambridge Machinery Sales

AUCTIONEER

Bob Hall

(Cheffins Grain and Comins)

THE second-hand machinery market will continue buoyant throughout the year, with home demand supplemented by a strong export trade.

So says Bob Hall, auctioneer at the monthly Cam-bridge Machinery Sale. Running now for over 50 years, this event typically attracts over 2300 lots, including 500-plus tractors.

"Well over half the tractors we sold last year went direct for export," says Mr Hall. "And many bought by UK buyers may have indirectly gone abroad."

Lack of availability of certain machines in some parts of the world is the reason for this strong trade, suggests Mr Hall. In total, machinery at the sale went directly to over 30 countries last year.

The better quality tractors are usually destined for other Euro-pean countries, says Mr Hall.

But demand for what UK farmers might consider to be obsolete equipment comes from less agriculturally and economically advanced countries.

"Old Massey Ferguson 1-series tractors are extremely popular in South American and Middle East countries, for example.

"The only down factors for the year ahead are Greeces introduction of legislation preventing registration of newly imported tractors of over seven years old.

"And in Syria – traditionally a strong buyer of second-hand British tractors – no more import licences will be issued."

Home demand, meanwhile, has been fuelled by current agricultural prosperity. "Farmers have funds," agrees auctioneer Michael Hamilton, who is also involved at Cambridge.

This is often more evident at machinery dispersals than at collective sales, where a large part of the business is "by the trade, for the trade", he says. Home demand is present throughout the year. But the timing of dispersals tends to be arranged to fit in with other considerations such as cropping patterns and tenancy arrangements.

There seem to be few dispersals taking place at the moment, says Mr Hamilton.

"In the past, the trend towards contract farming prompted some; and at times of agricultural hardship, some people are always forced to leave the industry.

"Higher land values have also dissuaded many farmers from selling up. But there will always be some sales as a result, for example, of tenants retiring."

This, and two profitable years in many areas, have combined to keep bidding brisk at on-farm dispersals, says Mr Hamilton.

"Well-maintained machinery and equipment will continue to sell well. And the gap between the price made by the good and the bad may widen."n

At £14,600, this John Deere 3350 was the highest-priced item at a rationalisation sale held at Lavenham Hall, Sudbury, Suffolk, last week. Registered in April 1989, it had 3770 hours on the clock. Next best bid was £11,400 for an eight-year-old Massey Ferguson 3090 which had done 3350 hours work. "More and more farmers who find they have surplus kit are now considering offering it on-farm, rather than entering it into a collective sale," suggests auctioneer Robert Fairey. The two combines sold on the day may be destined for export – possibly to the Far East or Pakistan, he suggests. (Brown and Co)

Machinery prices will stay firm thanks to a strong home and export demand, says Bob Hall

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AUCTIONEERS COMMENT

1 March 1996

AUCTIONEERS COMMENT

MARKET

Chippenham

AUCTIONEER

Trevor Rowland (Alder King)

TRADITIONAL auctioneers are becoming increasingly involved in private treaty sales of livestock, says Trevor Rowland.

He has been involved with one such service since its establishment two-and-a-half years ago.

"It was set up as a bolt-on service to our electronic auctioneering business," he says. "There are people who only sell finished cattle deadweight, and only buy stores to replace them privately or from a dealer.

"So we decided to supply them with store stock, as well as selling finished animals for them.

"But the service was never intended to take business away from our traditional livestock auctioneering system. They are two different sectors, used by different groups of people."

It is rare, therefore, to see farmers offer stock at auction having tried unsuccessfully to sell it privately, he says.

"We have to recognise that there is a new generation of farmers and farm managers, who use traditional markets less than their predecessors. More people want to trade by phone or by fax nowadays."

Having initially sold mainly cattle, it soon became apparent that the private method also suited store lambs. "Not least because these are often traded in large batches and on a fairly regular basis."

Trading suckler cattle has also proved popular, he points out, "because private sales can give buyers access to batches of fairly uniform stock".

"Similarly, the number of dairy stock sold in this way is also increasing," says Mr Rowland. Unlike the "repeat-purchase" market for store stock, these, however, tend to be "one-offs".

It is especially appropriate for high-quality and pedigree dairy animals, as it may give buyers more access to information about the cattle, he adds. And it also gives buyers the chance to view stock on the farm, in its natural environment.

Such one-off offerings attract buyers from a wide area, he points out. And for this reason, the firm has recently begun advertising stock nationally, in addition to its local marketing review.

Sellers have to pay 2.5% commission. But unlike at an auction – in which sales are usually quickly effected – private treaty sales take longer, says Mr Rowland.

"The key to a successful and quick outcome is a realistic valuation," he says. "And being involved in two weekly livestock markets enables us to give up-to-the-minute advice on price trends.

"Traditional livestock markets will always have a vital role, not least as a benchmark for other sale methods. But there may be fewer, with each handling a larger throughput.

"And we, as auctioneers, have to consider the ancillary services that we can offer the farming community."n

Traditional livestock markets will always have a vital role. But auctioneers should also provide ancillary services, says Trevor Rowland.

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AUCTIONEERS COMMENT

23 February 1996

AUCTIONEERS COMMENT

Chris Jones (McCartneys)

LOWLAND sheep quota for 1997 may be leasing for about £5 a unit when the first lots are traded this year, says Chris Jones, a partner with McCartneys.

And LFA quota will be changing hands at about £12 a unit and £35 a unit for lease and sale, respectively, he predicts.

"There probably wont be much business done before June," says Mr Jones. "And buying it then means there will still be 18 months to wait before ewe premium can be claimed."

But experience with 1996 LFA quota shows that those who acquired it early saved money, with prices rising rapidly towards the end of the trading period on Feb 4.

Conversely, an oversupply of lowland quota saw prices go into "freefall" at the same time. "I heard of it being leased for as little as £1 a unit; there were even rumours of it being given away, so that it wasnt lost."

New usage rules, which dictated that quota would be lost unless 70% or more of it was used, brought more on to the market and sale prices for lowland fell as low as £10 a unit, he says.

"But prices for 1997 quota are unlikely to be so low. It defeats all logic of valuation to sell an asset for, say, £10 or lease it for £3 when it can generate £20 a year in ewe premium."

But the marked difference between lowland and LFA prices will continue. At the end of the 1996 trading period, this differential – up to £10 – far outweighed the LFA supplement, says Mr Jones. And it led to a few marginal farmers changing their designation from LFA to lowland.

"Some farmers could alter the amount of upland or lowland ground they rented, for example. And by ensuring that more than 50% of the total was lowland, their designation changed accordingly. They could then lease in and use lowland quota for £3 or £4 a unit and lease out their LFA quota for £13 or £14 a unit.

"Prices of lowland quota fell because a lot of farmers decided, after the new single retention period was announced, that they were not going to keep sheep. A short-term oversupply resulted, pulling prices down from £7 or £8 a unit to £3 or £4 a unit.

"Their change in policy could not be altered and the quota had to be leased out for fear of losing it. But those farmers that wanted to get out of sheep production have probably done so, and so the oversupply will not be so large this year," says Mr Jones.

But demand in the uplands will continue strong, due to the lack of alternative enterprises. This strong demand took 1996 LFA leasing values to £14.50 and sale values to £45, he says. "The market was moving in the opposite direction to that of lowland."

This dichotomy needs to be addressed by government, says Mr Jones. "With the HLCA payments and LFA supplement, the government recognises that it is the upland areas which need support. But, because of the limited resource of quota in those areas, any benefits given are being eroded by the cost of quota."

One solution could be to allow it to be traded between the uplands and lowlands, suggests Mr Jones. Already there is a large geographical movement within the market, he points out. Of the 30,000-plus units of 1996 quota traded by Mc-Cartneys a substantial amount "went north". &#42

Demand for quota remains unsatisfied in the uplands, so prices will stay buoyant in these areas.

Government support for sheep farmers in LFAs is being eroded by high quota costs. One solution could be to allow trading between the uplands and lowland, suggests Chris Jones.

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AUCTIONEERS COMMENT

2 February 1996

AUCTIONEERS COMMENT

MARKET

Salisbury

AUCTIONEER

John Bundy (Southern Counties Auctioneers)

WITH numbers set to fall, Friesian calf prices should now rise until May, says John Bundy.

"Now there is more stability in the export trade, prices should follow the traditional seasonal pattern this year."

But the fragility of the export situation must not be forgotten, he stresses. "It is still an issue – and probably always will be."

And protests are not the only source of potential disruption, he points out. "Recently, a ferry crossing on a Monday was affected by mechanical problems. It was Wednesday before the boat sailed again and so, being a Tuesday market, we saw prices fall."

It was, says Mr Bundy, reminiscent of the height of the live-export dispute when Friesian calves would fluctuate – sometimes on a daily basis – between making reasonable prices to being almost unsaleable.

Farmers returns, meanwhile, have been squeezed since the dispute because transport costs have risen, he says.

"This partly reflects the expenses incurred by the exporters who stuck at their business during the difficult times.

"And it probably also reflects that there are now fewer parties involved, and, therefore, less competition."

Salisbury market – recently relocated to a new site – sells between 180 and 500 calves every week, depending on the time of year. The vast majority of the Friesians make the four-hour trip to Dover.

Prices are currently about £140 for the best sorts and £80-120 for typical export sorts.

The best stock will be making over £150 by May, he says. This price peak will, however, be followed by slightly lower values than traditionally would be seen during the summer.

"There used to be huge numbers in September. But the trend towards earlier calving has meant marketings are more evenly spread through the summer.

Salisbury also sells a large number of Channel Island calves. Typically making £25-30, such purebred Jerseys and Guernseys make fairly constant prices through the year.

"But the bottom would fall out of this if renewed disruption to the export trade were ever to divert a lot of second-class Friesians on to the home market."

The poorest, non-exportable calves, meanwhile, may remain hard to sell at certain times of year. But because of the BSP payment, there will always be some buyers looking for them, says Mr Bundy.

"If a farmer can buy a second-class Friesian bull at, say £60, then he may be tempted to do so, rather than purchase a native-breed heifer calf at a similar price.

"The calf could be sold on a blue CID at, say, 12-months-old, giving the farmer one premium payment. And the buyer may also give a small premium to reflect the fact that there is another payment still to come." &#42

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AUCTIONEERS COMMENT

26 January 1996

AUCTIONEERS COMMENT

MARKET

Yeovil

AUCTIONEER

Lester Williams (Symonds and Sampson)

DAIRY farmers should be looking ahead to next milk year and considering forward leasing quota, says Lester Williams.

The price of forward-leased 4% quota was 12p/litre last week. And with both lessors and lessees adopting a "take it or leave it" approach, that level looks set to stay fairly static until the new milk year begins on Apr 1, he says.

Indeed, such stability is one of the advantages of forward leasing. "A farmer can acquire it early at a fairly predictable price. And this provides security and peace of mind. It also allows business planning around a known expenditure, while payment can be spread with, say, one-fifth of the cost paid now, and the rest on Apr 1.

"If farmers wait, they may be able to source the quota more cheaply; but there is always the risk of rising values, or of not being able to get the right butterfat."

A price of 12p/litre now is unlikely to differ greatly from next seasons overall average value anyway, says Mr Williams. "This year, our total trading levelled just over 12p/litre.

"It depends on how prepared – and how able – the individual is to risk waiting in the hope of getting it cheaper.

"The farmer should look at what suits the particular farm structure. Larger businesses, for instance, may desire stability and therefore take more in advance.

"Similarly, those who lease a large proportion of their total requirement may also like to source more at an early stage.

"And some, of course, will take, say, half now and acquire the rest at intervals through the year."

There is much in favour of this approach, believes Mr Williams. "Risks are spread; and the burden of payment is spread over a longer time, allowing the outlay to be financed from milk cheques."

Meanwhile, quota sale values are likely to rise in the run-up to the quota year end on Mar 31.

Approaching the 75p/litre-mark last week, it could soon be at 80p/litre if supplies remain very short and milk production high, suggests Mr Williams. And that of a very high butterfat could go close to £1/litre.

"Production is the all-important factor in determining where it goes from now," he says. "And if this stays up – as it looks like doing – then so will quota values."

Farmers in the area have been "pleasantly surprised" at how well cows are currently milking, he says. And they will be reluctant to "turn off the milk tap" – despite the prospect of superlevy – because of the long-term affect on output.

"Cutting yields at the point in the production profile where they would otherwise be rising can adversely affect output throughout the rest of the lactation.

"And this, therefore, has an adverse affect on not just this milk years production, but next years, too." &#42

Stable forward leasing prices help, business planning, says Lester Williams.

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AUCTIONEERS COMMENT

17 January 1996

AUCTIONEERS COMMENT

Carmarthen Market

Bob Jones

LOTS of people talk about their faith in the future of farming and auction markets, but Bob Jones has put his money where his mouth is.

Mr Jones is heading a management buy-out of part of the Halifax building societys agricultural interests in Wales. His philosophy is simple: "People will always have to eat and people will always have to live and work in the countryside."

Three livestock markets will be among the portfolio of the newly-established Bob Jones-Prytherch and Co. Carmarthen, the largest dairy market in the country, will be the flagship, with Haverfordwest and Llandeilo also important contributors.

A licence has been taken at Carmarthen, with full tenancies at the other two sites. Term length is up to 15 years, with the shorter agreement at Carmarthen reflecting proposals to relocate the mart to an out-of-town site in the next few years.

"Haverfordwest, as one of only two marts in Pembrokeshire, has great potential," says Mr Jones.

But all three will be central to our work. "They provide our day-to-day connection with farmers and, therefore, our pool of customers."

And this willingness to give people time, initially on a free basis, is becoming an increasingly important way of companies differentiating themselves. Farmers need to seek advice on more and more issues these days.

"Years ago, people used to come to me and say This is what I have done, what do you think?

"Now, with ever-more complex legislation, it is more important to take advice before acting."

Capital gains and inheritance tax, farm business tenancies, planning permission – the list goes on.

But the marts have a key role in their own right. They will not be loss-leaders; they will be profitable, says Mr Jones. "Back in the 1950s, people said the days of live auctions were limited.

"But they still provide choice. If producers only had one method of marketing animals, there would be no comparables and the price could be easily dictated by the buyer.

"If you do not like the price at which bidding in the mart stops, you can reload your wagon and take the stock home."

And livestock – especially cattle – is not a uniform product. Different products should have different values. Markets also play an educational role, giving an immediate message as to what the meat trade wants.

For Mr Jones, the establishment of the new company with his former colleagues represents a complete turn of the wheel. In 1988, he was the senior partner of John Francis, at the time of the Halifaxs takeover.

"We would have liked to have kept the John Francis name," says Mr Jones. "There was a lot of goodwill attached to it and, even outside of Wales, it was well known.

"Apart from any sentimental reasons, it would have made good business sense, too."

With the last John Francis having died almost 40 years ago, it shows how important a name can be.

The Halifax, meanwhile, continues to concentrate on its core business, residential property, distancing itself from agriculture. Which is rather good news for Bob Jones, who, after 40 years in the business, finds himself relishing the prospect of another new challenge. &#42

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AUCTIONEERS COMMENT

15 December 1995

AUCTIONEERS COMMENT

MARKET

Colchester

AUCTIONEER

Graham Ellis (Stanfords)

SHORT supplies will boost fresh turkey prices this year, according to Graham Ellis at Colchester, one of East Anglias largest poultry markets.

Many smaller producers had a bad year in 1994, he says, blaming a combination of "over-supply and cut-price supermarket birds".

Turkeys still represent a useful enterprise which can improve cash-flow at a quiet time. But the reduction in numbers – most evident on mixed farms, where, perhaps, 600 to 700 birds were previously kept – may result in Colchester selling 2500 this year, compared to 3500-plus in 1994.

These will be sold between the markets three offerings of "New York dressed" poultry on Dec 16, 19 and 21.

The big producers have maintained or even expanded output, says Mr Ellis. But they tend to process their own birds; and so do not generally pass through markets.

The net effect could be that hens could be making about £1/lb at market; and cocks 80p/kg, says Mr Ellis. Once again, typical weights will be 16-18lb and 22-30lb, respectively.

Values will also benefit from the recent "ill-founded" BSE publicity, suggests Mr Ellis. "We may see buyers opt for a turkey at Christmas, instead of a rib of beef. The lamb and pork trade has already strengthened because of this."

But supermarkets, once again, will be a strong competitor. With prices as low as 29p/lb being talked about, it is very difficult for farmers to compete in the 10lb to 12lb range in which the supermarkets specialise.

"Farmers tend to produce heavier weights, with hens between 16lb and 20lb, and slightly larger cock birds. And they use their marketing advantage in terms of producing a fresh, well presented, traditional product.

"Many people come to the market specifically to buy from one source. They know that a bird from a particular farm will be present and that it will eat well."

Indeed, Christmas poultry sales also encourage members of the public into markets who otherwise would not come, says Mr Ellis. Last year, over half were bought by people who bought just one or two for their own needs.

Geese numbers will also be slightly down, he suggests. But prices will be similar to last years at between £1.25 and £1.30/lb.

Chickens, meanwhile, should be similar again in numbers, the larger ones selling for about 80p/lb.

Most of the entries at Colchester will be consigned by units in Essex and Suffolk, although some will come from further afield.

Our second sale will probably be the largest, he says. "But if supplies are particularly short, the trade may be actively buying at our last sale. Although, by this time, it is usually too late." &#42

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AUCTIONEERS COMMENT

1 December 1995

AUCTIONEERS COMMENT

MARKET

Exeter

AUCTIONEER

Alan Webber (Exeter Market Auctioneers)

THIS years Christmas primestock shows should be successful after a year of brisk stock prices and generally prosperous agriculture, says Alan Webber.

But the days of the large, traditional events held in some markets may be numbered, he fears. "Farmers are under more and more pressure nowadays and many no longer have the time to bring cattle to the standard required for showing."

The Christmas shows have also suffered, as a result of the decline of local butchers.

"In the past, the butchers would compete for the champion," he says. "They took great pride in displaying the rosette and hanging the carcass in their shops." And it was this competition, suggests Mr Webber, which often led to the high prices paid for prize-winning animals. Four years ago, for example, the champion steer at Exeter made 715p/kg and grossed over £4360. The champion pen of lambs in 1992 returned £100 apiece.

"The butchers that were buying five years ago have, in many instance, been squeezed out by supermarkets. And the abattoirs and wholesalers that supply supermarkets are less interested in securing prize-winners.

"When people were buying meat from a butcher, they knew it came from a top animal at their local show. But that sort of traceability may be lost when a beast is divided and sold through a supermarket."

Although he doubts if the high prices of the past will return, he is confident the cup winners will still be in strong demand. "And good animals, even if they dont win anything, will continue to make strong, commercial prices.

"Indeed, they could still make good money without necessarily having been entered for the show," he adds. "And farmers are conscious that preparing animals, especially cattle, can be time consuming."

At the same time farmers are becoming ever more aware of what the finished market wants and so the differential between a good commercial beast and an award winner is narrowing.

This has led to some markets experiencing a decline in show entries. Nevertheless, Mr Webber remains optimistic about the long-term future of Christmas shows. He says they are an important date in the social calendar and also encourage the production of top quality animals.

He is also confident that neither adverse BSE publicity nor the cattle offal levy handling dispute will spoil this years events. In fact, they may even help bring people together at a time when relations need to be improved.

Exeter is gearing up for its annual event next Monday (Dec 4) when, in addition to the usual commercial numbers, about 75 cattle and 70 sheep will be entered for judging.

"We always see a good crowd and I am looking forward to the day as a nice way to end the year," says Mr Webber. &#42

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AUCTIONEERS COMMENT

17 November 1995

AUCTIONEERS COMMENT

AUCTIONEER

Terry Court (Russell, Baldwin and Bright)

LIVESTOCK markets should become more involved in farm assurance schemes, says Terry Court.

The company of which he is vice-chairman has introduced the Farm Assured British Beef and Lamb scheme (FABBL) into all of its Welsh and Welsh border markets.

"We planned to introduce our own scheme after it became apparent the major food chains preferred assured products," he says. "But it became clear that linking in with the existing FABBL guidelines would make more sense."

In conjunction with Sunder-lands and Hereford Market Auctioneers, the scheme will be operated in nine markets. And with 30,000 farmers selling over one million sheep and 300,000 cattle through these sites annually, the potential uptake could be huge, says Mr Court.

He stresses the voluntary nature of the scheme. But if a premium is seen for assured stock – as Mr Court believes will increasingly be the case – then uptake will be quickened.

"We are sending our staff on courses to enable them to carry out the farm inspections which are a prerequisite to joining," says Mr Court. "This farm visit will probably only take a few hours, and membership in the first year will cost farmers about £40.

"Most farmers will meet the requirements without needing to make any changes," he adds.

"Stock consigned can then be bought with confidence over such key areas as product traceability, husbandry and veterinary standards.

"It gives an opportunity for farmers to sell stock through the live auction system, while still meeting the production standards of the major buyers," he says.

"As auctioneers," continues Mr Court, "we need to put into place a system which enables our clients to sell their animals in the most profitable way."

And seeking full FABBL approval of the markets themselves will also give a guarantee that the conditions of penning, handling and lairage, for example, are also of a high standard, says Mr Court.

"Although, like farms, many livestock markets will already exceed the prescribed standards," he says.

One of the key advantages of the scheme is its simplicity, stresses Mr Court. FABBL development officer Tim Green agrees. "Involving market staff in the farm inspections will mean the farmer is dealing with someone with whom he already has a close relationship.

"And the fact that operations at the market are also covered by the rules is crucial. This will help combat the public perception that while farm and abattoir standards may be closely regulated, markets may not be so tightly monitored."

Markets are increasingly becoming involved in the scheme, says Mr Green.

When the demand, relative to the supply of farm assured stock is high, as it is at present, there could well be a price differential, he points out. &#42

Terry Court says markets have

an important part to play

in assurance schemes.

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AUCTIONEERS COMMENT

10 November 1995

AUCTIONEERS COMMENT

MARKET

Wooler

AUCTIONEER

Scott Donaldson

(County Auctions)

CONFIDENCE in the beef trade has underpinned this years brisk suckled calf trade, according to Scott Donaldson.

"Despite usually falling in September, beef prices rose this year, giving the autumn sales a kick-start," he says. And trade has continued strong, with steer calves typically making about 15p/kg more than in 1994.

At Woolers fifth major calf sale of the season last week, steers were regularly topping the 185p/kg mark, to average 158.2p/kg. Heifers, meanwhile, frequently rose above 140p/kg, levelling at 126p/kg.

Unlike on earlier occasions, when yearlings accounted for most of the entries, the majority of the 1000-strong contingent at this event were spring-born calves. Selling such animals in the autumn is increasingly common, says Mr Donaldson.

"The animals had benefited greatly from the late flush of grass, with many having had no straw or concentrates."

Marketing them before the winter is, therefore, "exceptionally cost-effective", he suggests.

The increasing size of herds in the area has also contributed to the trend toward selling spring-born calves in October and November. "Stock isnt being marketed because of any shortage of keep, but because of a lack of shed space."

Larger herds have also led to the production of better-quality stock, says Mr Donaldson. "With many herds having over 100 cows, the purchase of a good bull can be justified, rather than perhaps sharing one or using AI."

One farmer, for example, sold 700 Charolais calves in two days at Wooler last month, points out Mr Donaldson.

And Charolais continue to acc-ount for a large proportion of the calves sold at the market (over half at the most recent event). "They show the most favourable weight-for-age ratio," suggests Mr Donaldson. "But Limousin, Sim-mental and Blonde dAcquitaine are also popular in the area."

Whatever the breed, however, quality remains vital, stresses Mr Donaldson, with an "enormous" price gap evident between top- and second-quality sorts.

Suckled calf prices have also been given a boost by the profitable grain harvest, he says. And buyers also seem to be more conscious of the subsidy payments available this season, he adds, further helping demand.

The buoyant trade, he says, has led to changes in buying practices. "Potential buyers have been forced to go home without any stock," he says. "And unlike in previous years, there seem to be fewer people buying big loads out of any one particular market on one particular occasion.

"Theyll will buy from a variety of places, in small batches, as and when the prices allow. And they are more prepared to travel further afield to source stock, too."

Indeed, with the suckled calf trade so buoyant, Mr Donaldson has some doubts as to whether satisfactory returns will be available on the most-expensive animals.

"But the clean beef trade looks set to stay strong," he predicts, "and so hopefully there will be money in these calves." &#42

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AUCTIONEERS COMMENT

1 September 1995

AUCTIONEERS COMMENT

MARKET

Gloucester

AUCTIONEER

Keith Flemington (Bruton Knowles)

DAIRY farmers in the eastern counties considering dispersing their herds should be selling "on-farm" rather than removing the stock for sale in a more intensive dairying area, says Keith Flemington.

One of the main advantages, he says, is that it allows the cows to be presented "where they have lived and worked". Buyers like to see the cows in this environment, he remarks.

"However good the transport and market facilities are, cows may not look as happy and content as if they had been kept on the home farm." And the suggestion that dairy cattle offered in counties such as Norfolk, Suffolk and Essex will meet an insufficient demand is rebuffed by Mr Flemington.

Some potential vendors still have the perception that dairy farmers, and therefore buyers, are "few and far between" in the region, he points out.

"But the exit of dairy cattle from the area seen eight or 10 years ago has stopped, and there are now a number of large and growing herds.

"Plus, if the stock is of a decent standard, buyers will travel," he adds.

"The likelihood of them being discouraged by the potential cost of transporting stock back to their farms is also questioned by Mr Flemington.

"One must not underestimate the number of large hauliers who are very competitive in their quotes," he says.

And while Mr Flemington acknowledges that access to the eastern counties from some areas can be difficult, he says that "over the years, auctioneers have been relatively successful in persuading buyers to go to East Anglia and the south east."

And this, he says, has been reflected in the prices achieved. The most recent sale in the area Mr Flemington was involved in was the dispersal of the Myles Stimpson Farms prize-winning herd of Newbuckenham Holstein Friesians near Norwich. There, 77 cows averaged £1272; seven bids of over 1000gns were taken; and the top call was 2700gns.

"About two-thirds of the cows stayed in the area," he remarks.

"In the case of very large herds, it is probably not practical to move the cows anyway," he says. "And where very small herds are involved, other options, such as moving them, or selling them privately, have to be considered.

The four main costs of a dispersal, points out Mr Flemington, are:

&#8226 Advertising.

&#8226 Catalogue printing.

&#8226 Catalogue distribution.

&#8226 Auctioneers commission.

"And a vendor will incur these wherever the herd is sold. In fact, if it is removed, the seller has the additional task of moving the stock."

And on-farm sales also offer the opportunity to sell equipment and machinery at the same time as the herd, concludes Mr Flemington.

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AUCTIONEERS COMMENT

25 August 1995

AUCTIONEERS COMMENT

MARKET

Taunton and Bridgwater

AUCTIONEER

Derek Biss (Greenslade Hunt)

MORE dairy dispersal sales will take place in the 1995/96 quota year than ever before, says Derek Biss.

"We have handled about twice the number that we had by this time last year," he remarks. And he points to two main reasons: Poten-tial tax advantages and quota prices.

"Most of the dispersals this year have been by farmers who wish to attract retirement relief," he suggests. "For many, this has been decision year, as there seems to be a growing feeling among farmers that the political climate could change, and with it the tax rules."

Dispersal have also resulted for capital gains tax reasons, says Mr Biss. And in total he estimates tax factors have motivated about 90% of this years sales.

He says that in areas east of his Taunton base – Wiltshire, for example – there has been a particularly large number of dispersals.

These tend, he says, to be the "estate-type" farms. Such "managed or investment" farms, he says, seem to be more prepared to make the decision to disperse purely on financial grounds.

"They are opting to cash their quota while the price is relatively high and enjoy the capital gains tax advantages by reinvesting the proceeds in arable land."

Mr Biss thinks that for the rest of the quota year there will be two distinct types of sale:

&#8226 Those where the decision to cease milking was taken some time before. Such farmers are likely to have geared themselves up for summer milk producers. Many such sales either already have or are very soon to take place, says Mr Biss.

&#8226 Those where producers are forced to quit having been unable to afford quota. These, he suggests, will occur mainly from September onwards.

Earlier this year most auctioneers were predicting a shortage of sales in the autumn, he points out. But, he has since been surprised by the number booked for then. "In this area I doubt if there is a day in late September when there isnt a sale taking place."

And prices of heifers at that time are likely to be "better than last year but not a flying trade".

"Barren cow values are crucial in putting a bottom in the market. And this year milk-and-kill cows have been making over £500. This is, in some cases, almost twice as much as 12 months before."

Confidence at sales will also be helped by firming Friesian calf prices, he adds. Currently at the £120 to £140 level, he predicts calf values will rise as home and export demand strengthens. "Lower numbers resulting from the shift to summer calving will also boost trade."

Recent dispersals of typical, well bred commercial herds have averaged about £750, he points out.

Normally Mr Biss sees sales tail off in November and December. "But this year, like last, there will be some who are forced to leave because of their quota situation.

"But once we get to Christmas the number will diminish. Not least because at that time of year it is difficult presenting stock for sale."

Derek Biss says this will be a record year for dairy dispersals.

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AUCTIONEERS COMMENT

28 July 1995

AUCTIONEERS COMMENT

MARKET

Sennybridge

AUCTIONEER

Mike Tompkinson (Clee, Tompkinson and Francis)

SHEEPDOG prices have risen over the last 18 months, says Mike Tompkinson, who presides over three such sales a year in Sennybridge, Powys.

"We have been holding them for 20 years," says Mr Tompkinson, who until recently, had never sold a "four-figure" dog. But twice in the last eighteen months, entries have reached £1300.

"Prices have firmed for the very best dogs because there is a shortage of them," he says. "Farmers, busy with other tasks, have less and less time to devote to training."

A good, well-trained animal will typically make between £400 and £600, and sometimes more, says Mr Tompkinson. Those partly-trained, meanwhile, are more likely to fetch between £100 and £300. "Such slightly cheaper dogs give the buyer the opportunity to invest a smaller amount of money and complete the training.

"Farm workforces are shrinking, and machinery is costly, so the interest in dogs is ever increasing," says Mr Tompkinson. "And most make an excellent investment. There is the value of any potential litters to consider, too. And, of course, the companionship element."

The spring and autumn sales tend to be the largest, sometimes attracting as many as 100 entries. There is also, he remarks, a well-known biennial event at Malvern. But Mr Tompkinson says there is a demand throughout the year.

And this is why last Saturday, for the first time, a mid-summer sale was held at Warwickshire College of Agriculture, Moreton Morell. "It is situated near the M40, and therefore gave some people who would have been unable to come to Sennybridge, the chance to buy and sell dogs." It saw an average price if £301, and a top of £416.

Dogs sold at auction tend to be between one and two years old. But some are younger, he says. "And if it can work well below 12 months old, it is a good indication it has high potential."

Indeed, at auction, all dogs are worked immediately prior to sale to give potential purchasers an insight into their ability.

"The animal is away from home, surrounded by other dogs and, perhaps, unsettled by its surroundings. If it works well, it is an excellent reference. There are instances of dogs being unsettled and under-performing, but usually they cope."

Once the new owner has gained the dogs confidence, there are very few instances of it being unable to adapt to its new working home.

Among the attributes demanded are:

&#8226 Steadiness

&#8226 Strength

&#8226 Responsiveness to commands

&#8226 Good temperament

&#8226 Willingness to travel in vehicles

"Most dogs were traditionally sold privately," points out Mr Tompkinson. "But this is changing as buyers confidence in the auction system has increased. And this, too, has helped to firm prices."

It has also, he says, helped to establish a "market price".

There is an international market, too, he says. "We have sold to American and Swiss buyers. The first £1300 dog at Sennybridge went to an Irishman who came here specifically to buy dogs." &#42

Mike Tompkinson says sheepdogs are an excellent investment.

Three generations of the Hamer family from Bridgnorth: Ken, Kevin and 11-year-old Andrew. Of the four dogs they offered, best price was £400.

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