Silver Fern Farms forecasts record spend

Silver Fern Farms is forecast to spend more than $230 million on livestock this month - its biggest monthly livestock spend so far - as high volumes caused by dry conditions and high prices make their mark.

In an update to suppliers, chief executive Dean Hamilton said the warm weather being experienced throughout the country had pushed stock processing levels higher than normally seen in December.

Plants had been brought on early because of the rapid dry-off after good spring growing conditions and the company had recruited more than 1000 new seasonal staff, who had been trained over the past month.

Each week, Silver Fern Farms was processing more than 20,000 cattle, 180,000 sheep and 3500 deer. All plants were operating at or near capacity, Saturday shifts, and additional chains, overtime and night shifts where possible, being employed so the high flows could be processed.

Even with record levels of weekly capacity and throughput, there was ``exceptional'' demand by farmers for space, and queues for processing space were forming, Mr Hamilton said.

The combination of high volumes and high livestock prices, particularly for lamb, mutton and venison, meant the company was now forecast to spend more than $230million on livestock alone this month.

The new equity investment by Shanghai Maling last year and the company's new banking facilities meant it had the capacity to manage the high demand on capital, he said.

A similar note to Alliance Group suppliers said the combination of lamb weaning drafts now in full swing and farmers quitting ewes meant the co-operative's processing capacity was under pressure.

Its livestock team was working hard to ensure it could meet space requirements. It was maximising processing capacity and all plants across the country were fully operational and running extended shifts.

Priority for processing was being given to platinum and gold shareholders, but there was still a possibility of a delay in securing space as many farmers wanted space at the same time.

Alliance was also working with shareholders to ensure store stock from breeders could be placed with finishers. However, it was becoming more challenging to secure finishers to take on store lambs as feed supplies started to tighten.

Farmers looking to take store lambs should ensure they had adequate feed available before committing, as some buyers had cancelled their orders the night before delivery.

DairyNZ extension general manager Andrew Reid encouraged dairy farmers to have a plan in case dry conditions continued. In many regions, silage yields were down and summer crops had been sown late.

Farmers always factored variable weather into their seasonal plans, so many, if not all, would be ``pretty well prepared'' for the dry conditions.

However, it was timely to revisit the summer plan and talk through different scenarios with the team, such as supplementary feed usage, culling policies, once-a-day milking, irrigation priorities and what the target dates and trigger points for dry-off decisions were.