Lamb war lifts prices near $100

A North Island-South Island procurement war has pushed prices for prime lambs up near $100.

Wanganui lamb prices reached new levels at the Fordell sale last week, where top sheep in the prime pens fetched $99.50 and $95, while conditioned lambs in the store sheep section sold at $86 and $84.

The battle really heated up at Feilding when processors helped push prime lamb prices up to $4.90 a kilogram deadweight.

Last year, the better lines of male lambs sold up to $55 and good ewe lambs fetched $49; two years ago the same sale was fetching $44 for top woolly ewe lambs.

Williams and Kettle Wanganui livestock manager Harvey Falloon said the new price levels were largely driven by stock shortages and the procurement war between North and South Island processors.

"It's been brewing for a couple of weeks now," he said. "I don't know just how sustainable these prices will be, but the farmers are certainly the winners so far."

Mr Falloon was not sure which companies were winning the procurement battle to secure lambs for export markets.

"I don't know how many lambs are heading south, but I don't think any of the export companies will be enjoying this."

The battle has coincided with South Island company PPCS' renewed attempts to buy a big stake in profitable North Island company Richmond, which has good access to North Island lambs.

Richmond was subject to a hostile takeover bid by PPCS last year, but PPCS was forced to sell the 34 per cent stake it built up, at preportedly between $1.25 and $1.50 a share, because it failed to meet notification requirements for buying them.

It is now buying Richmond shares on the Stock Exchange at about $3 a share.

- NZPA