Sheep quota in big demand
Sheep quota in big demand
FARMERS were scrambling to find sheep quota right to the Wednesday (Feb 4) close of trading.
And the fear now, with so many sheep tied into the quota system, is that a flood could be sold after the retention period ends on May 15. And this, in turn, could drive prices down and counter the benefit from premium payment.
"AWOL" is how agent Duncan Clark describes the trade over recent weeks, as farmers baulked at the prospect of selling hoggets on the depressed slaughter market.
"But after mid-May, prices could be appalling. During the retention period could be the only time they pick up."
Quota prices early this week were variable, with GB lowland samples trading between £2.50 and £5 a unit, says Mr Duncan.
Richard Hyde of Sunderlands also wonders whether farmers are just "postponing the evil day".
He saw a "fortnight of mayhem" as farmers scrambled for quota. It is a complete turnaround from last year when, towards the end of the trading period, GB lowland was changing hands for £1 a unit. "Back then I heard of some being given away under the use-it-or-lose-it rules."
Not only have people held on to hoggs this season to "run them round", says Mr Hyde, but sales of cull ewes have also been postponed. "Some are only just creeping into the £40s that last year were making £80-plus."
Townsends James Sheppard says a little more quota was available towards the end of the trading period as people offered any surplus. GB lowland sale and lease quota was changing hands for £5 and £9, respectively, early this week.
"At prices much above these, people may do better not getting quota. That way, although they wont get premium, they are free to sell stock at any time, rather than having to offer it on to a flooded market after the end of the retention period." *