New Zealand Angus Association president Tim Brittain believes farmers who pay top dollar for Angus bulls for their beef breeding operations know what they are doing and have a long term view of what they hope to gain from the genetics.
He also maintained the recent prices paid for Angus bulls for commercial beef operations was sustainable.
However, two bull breeders and a top livestock auctioneer have slightly different views.
The latest round of bulls sales has shown stud breeders willing to invest big money in the genetics they are after and commercial farmers paying more than they perhaps would have liked for a paddock bull.
Angus did particularly well with their sales.
But PGG Wrightson livestock auctioneer Bruce Orr is wondering if the high prices farmers paid for bulls for their beef operations are sustainable.
Many of the lesser Angus sires sold for $3500 and upward with sale averages higher than last year.
“You would wonder how those $10,000, $12,000 and $14,000 being paid for a commercial bull are sustainable,” Mr Orr said in the Timaru Herald on Wednesday.
Fairlie angus bull breeder David Giddings said he did not want to see prices creep up so far that they were unsustainable and North Otago breeder Neil Sanderson hoped the prices wouldn’t scare people into switching to other breeds.
Mr Brittain, Otorohanga, Angus breeder, explained the reasoning behind farmers’ willingness to invest in certain bulls.
“From an Angus perspective, we think people recognise the pogrammes we have got in place.
“Some farmers are wanting the genetics to improve their cow herds and the bulls they are buying, they are hoping to get five good years’ breeding out of them and that will have a huge impact on their herd over the next 10 to 20 years because of a lift in productivity and performance.”
Mr Brittain agreed with the comments of Mr Sanderson and Mr Giddings in that they didn’t want high prices to push farmers away.
“We don’t want people who have come into the Angus programme and can’t afford one of our bulls to go to a Simmental because it destroys what we are trying to achieve.
Our programme is based on 100 per cent Angus and minimal 75 per cent Angus.”
He was referring to the partnerships with Silver Fern Farms for Certified Angus, and the McDonald’s Angus and AngusPure supply programmes which famers can supply to.
But in order to do so, the AngusPure programme states that all products derive from Angus NZ registered or Performance recorded sires, while McDonald’s is pushing its Angus Beef burgers.
Farmers who support those programmes have a long term view of where they need to take their herd genetics to achieve those percentages.
“The key is the genetics,” Mr Brittain said.
It was worth considering also that farmers have come through two good years of growth, there is plenty of winter feed stacked away and beef and lamb prices have been impressive, so many will have confidence in beef and were prepared to pay more for bulls.