Guaranteed ewe offer by C.F.M.

Press, 13 November 1985, Page 2

Guaranteed ewe offer by C.F.M.

By

HUGH STRINGLEMAN,

farm editor The Canterbury Frozen Meat Company says it will guarantee fanners the export skin schedule returns for old ewes, less transport costs to freezing works. C.F.M. wanted to continue fully processing old ewes for export rather than divert them down “short” killing chains designed to recover the skins while the carcases and offals were rendered down, said Mr Dick Allen, a spokesman for the company. The much lower, unsubsidised prices schedule this season has made it possible that some grades of mutton would have negative meat returns to farmers after killing costs. The negative returns for meat then eat into the skin credits, which range from $4 to $8 a head, depending on the wool covering. Transport costs to the works must also be covered.

Thus many fanners have calculated that their old ewes are worth as little as $1 a head net. Farm leaders have urged that farmers take no less than $5 a head on farm for old ewes this season. Some companies have responded with various inducements and killing cost reductions to attract old ewes, the throughput of which holds the key to profitability of many meatworks. Now C.F.M. has said that a possible negative net meat return will hot affect the skin credits for ewes supplied to the company’s works.

At the bottom end of the mutton schedule, the C.F.M. guarantee could amount to a ?5 or $6 reduction in the sheep killing charge. A 20kg MH ewe carcase will attract only $4.80 from the board’s gross schedule for meat value to offset the normal killing charge of more than $lO. By guaranteeing the skin schedule less transport costs, C.F.M. would then have to absorb the difference between the normal killing charge and the export meat value. The two other companies running export meat plants in Canterbury have special shortened killing chains to cope with low-value ewes. C. 3. Stevens and Company, Ltd, expects to keep the special ewe offer going for another two or three weeks, according to its general manager, Mr Bob Trounce.

Ewes assessed by the company to have no export meat value were skinned and sent to the rendering plant while Stevens guaranteed the farmers the skin schedule less . transport costs, said Mr Trounce. All nine plants of Waitaki N.Z. Refrigerating, Ltd, were receiving ewes, according to the general manager, operations, Mr Joe Ryan, and were prepared to run “emergency chains,” killing only for skins with other raw materials being rendered. At Islington the minimum payment was the skin schedule less a $2 killing charge and less the transport costs.