Ongoing demand for red meat while winter feed availability prompts farmers to hold onto prime lambs pushing returns and stoking optimism.

Throughout the country livestock markets are well into winter mode. Calving is under way in most districts, while lambing is set to start soon.

With mild conditions and plenty of winter feed available, some farmers are focused on putting extra weight on their prime lambs before sending them to market. As a consequence, with export demand still excellent, supply is tight, and schedules are holding firm. In the North Island processors are paying $11.80 to $12 per kilogram for lambs.

At most North Island saleyards feeder calves are transacting at record volumes. Prices are positive, though also provide a reasonable margin for calf rearers. Early contracts for October delivery of bull weaners are sitting between $900 and $1000, although those values are likely to reduce for stock ready for supply later in the spring. Fears last month of a milk powder shortage have come to nothing, and all indications are that rearers will comfortably cope with the increased calf numbers.

Dairy farmers are starting to look for bulls, especially for upcoming heifer mating.

As farmers increasingly focus on calving and lambing in the coming weeks, activity in the saleyards is likely to slow down further.

Markets reflect that this is a good time to farm. Farmers are focused on maximising weights, especially for lambs, aiming to produce prime lambs as big as the market can take. Everyone is making a margin: breeders, fatteners and traders. Positive conditions and sustained optimism are likely to prevail into the spring.