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Opinion - Value of auction marts is proven

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Chris Dodds, executive secretary, Livestock Auctioneers Association

Livestock markets throughout Great Britain are once again proving to be the cornerstone of competitive and fair trade in the red meat sector.


I have been in the livestock auctioneering business for more than 35 years and I have never seen prime lambs regularly achieving more than £90 per head throughout August and into September.


The live ring has provided producers with an unrivalled trading platform for nearly 200 years and its strengths and benefits are being clearly highlighted this season. Which other trading platform works for the producer in the way the live ring does?


The auctioneer earns his commission based on the price achieved; the more stock makes, the more he earns, whereas collection centres and deadweight procurement agents are paid by the buyer, with a clear incentive to buy stock as cheaply as they can.


Possibly, we should all have stood up and paid more attention when Tesco tried to secure its supply chain of lamb earlier this year.


The guaranteed prices offered by the supermarket appeared, by some, to be too tempting to ignore, while the wisest woke up and asked themselves how they could guarantee a price which was so much more than achieved the previous year.


The simple truth is Tesco understood the world supply shortages and they knew an exchange rate near to 70p/euro, as we experienced in 2015, could not be expected through 2016, regardless of the Brexit vote’s outcome.

 

I wonder if those who signed up this year will be so keen to do so again next year.


Those who remained loyal to the live ring have certainly been well rewarded this season.


The competitive edge the live ring brings is certainly drawing more farmers back to selling through their local auction market, which in turn forces more abattoirs to use the ring to source enough lambs to fulfil their contracts.


Of course, the more active buyers stood around the ring drives competition and everyone wins, especially when demand outstrips supply.

 

Farmers Guardian
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