Auction market throughputs hold up well in 2016

Livestock auction markets in England and Wales handled almost £1.7bn worth of stock in 2016.

About 11.5 million cattle, sheep, pigs and calves passed through the auction market system last year.

The figures showed a dynamic and profitable industry, despite difficult trading conditions, said Livestock Auctioneers Association (LAA) secretary Chris Dodds.

Live markets account for more than half (55-56%) of slaughter lamb sales, which is as good a level as it has been for 20 years, said Mr Dodds. In the 1990s the level was more than 60%.

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In 2016, the overall number of store and breeding stock sold in markets rose by more than 70,000 on 2015 figures.

Slaughter stock figures also held up well – the total of 5.72 million head in England represented a 2% drop on the previous year.

Auction markets

  • Total value of stock through English and Welsh markets in 2016 was £1.682bn (£1.710bn in 2015)
  • Rising number of forward stores going through cattle rings but finished cattle numbers still falling
  • The Livestock Auctioneers Association has 82 market members holding regular sales in England and 34 sites in Wales
  • In 1995 there were 210 sites holding regular markets in England and Wales
  • The first registered auction market was held at Hawick in the Scottish Borders, in 1817

While slaughter cattle numbers fell by about 13,000, store cattle numbers rose by 30,000, likely to have been prompted by changes to abattoir grids and producer reluctance to risk penalties for finished stock.

Live markets now sell only 15% of finished cattle, down from about 20% five years ago and about 50% 15 years ago.

Although pig numbers rose in 2016, this was from a small base. Wales saw a 50% increase, to 3,000.

Dairy cattle numbers rose substantially in 2016, to 53,500 head sold for an average of £942 a head through English markets. This compares with 41,000 head in 2015 at an average of £1,072.

TB markets

As for many farmers, TB raises logistical and cost issues for markets in holding separate red markets for slaughter cattle only, where stock must move direct to slaughter and sheep or goats cannot be sold from the same premises on that day.

Business rates

Auction markets face an average business rates rise of 88% and the LAA is collecting evidence to challenge the new rates. The Valuations Office Agency (VOA) has agreed to consider the LAA material and to amend the increases if the evidence shows the formula used by the VOA is unfair or not correct.

The LAA argues turnover is a poor base for assessing rental values – turnover may rise but so do costs and so a business may be taking in more cash but profit may be lower. In addition, there were very few rented markets on which to base comparisons to arrive at a valuation, said LAA chairman John Brereton of Jones Peckover (St Asaph market) and Oswestry market.

Brexit

Trade and access to foreign labour are big concerns for markets as well as for farmers. Following last year’s EU referendum, the LAA initiated the UK Livestock Brexit Group to help provide a robust framework for the future of the industry, through a collaborative approach between the sector and the UK and devolved governments.

Stock numbers sold through auction markets in England and Wales in 2016 (2015 in brackets)

Throughput

England

Wales

Cattle

315,000 (328,000)

25,000 (29,000)

Sheep

5,286,000 (5,282,000)

1,721,000 (1,800,000)

Pigs

107,000 (110,000)

3,000 (2,000)

Total

5,708,000 (5,720,000)

1,749,000 (1,831,000)

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