Have I reviewed 2013 yet? No I have not. So here is 2013's outlook and what it means.
Last years unmitigated collapse in the market can very easily spin out of control. So far what I've seen this year only leads me to the conclusion that prices only go up despite flaccid demand and selling low in order to maintain an edge is not an option anymore. Everything else that you depend on is on the uptick even if your slashing costs on the front lines and what about supply?
Rumors are that there has been a steady price increase year on year and this has been happening for the previous 5 years. That agricultural pesticides etc used in palm oil have had adverse effects on Animal growth and size, that speculators not breeders have taken over the marketplace, adding little or no value to the product and selling at a premium that most people can not afford. That feed companies are raising prices regardless of the quality of their products selling on name only and not on actual mineral content of their feed.
Is this the truth? Yes it is I'm afraid, at least that is what I would be saying if I was doing a projection for this year. I would take the Worst case scenario and use that as my basis to determine if there is a business case for 2013. Add to that elections, possible weakness in Currencies and poor upfront demand and 2013 looks like the year where the RMS Zebutanic is going to have its day of reckoning.
Seriously of course, we have had a relatively good start for the year, with sales up and with a consistent stream of buyers week on week. The slack isn't that there are no buyers, but that there is no supply. Supply prices rocketed upwards in the early part of 2013, but this has not affected us so far, because we still have plenty of overpriced stock from last year to pump up and sell in 2013. The issue is when the stock runs out.
Sustainability is the focus for 2013 not viability. Any business can be viable in the short term, but not sustainable in the long run. Here is where the efforts to solve the issue should be, in cracking this issue. One way is to go and find suitable stock. The other is to let whatever that is broken be, and set up something else in its place that can make money. I'm looking at both ends and is convinced that this year is the year where there will be some undertaking of the Dairy end of the business.
Also it looks more and more like the end of an era. The days of consumers getting a good deal for quality cattle to slaughter are coming to an end. With the prices and the kinds of animals we have seen so far, I'm putting my money on a 2012 style collapse for this year and the rest is a bonus of course.
That is just my way of making a molehill out of a mountain.
Auf Wiedersehen. :)
