Cattle market gets its watershed moment

JENNY KELLY, The Weekly Times

THE storms at the weekend could be more of a game changer for cattle rather than lamb.

Rain across the north, with most of NSW receiving anything from 25mm to 100mm in the past week, could draw out northern restockers for the coming weaner calf sales.

In the south, the falls will extend the green feed season for cattle-producing areas in the North East and Gippsland.

Both these factors could add buying depth to the calf sales, and in the past it, competition between local and interstate buyers has produced the best price results.

There has already been some price movement for young cattle at saleyards, with the Eastern Young Cattle Indicator rising by nearly 5c/kg on Monday to push back over 580c/kg carcass weight.

Some market analysts believe the EYCI could once again reach the benchmark 600c/kg, which the industry has not seen since mid-winter.

Cattle supplies at saleyards fell away on Monday after the wet weekend, and there was not a lot of volume trading to confirm trends.

Early results suggests heifer prices could benefit the most from the improved conditions, which is not surprising, as traditionally heifers are the first cattle to be discounted when the market falters and the first to rebound when sales gather momentum.

At Wagga Wagga, NSW, on Monday small heifers to restockers rose 13c to an average of 298c/kg liveweight or $695 across an average weight of 233kg.

Heifers weighing over 30kg, were dominated by feedlot orders and rose 6c to an average of 290c or $1045 for 360kg, according to the National Livestock Reporting Service.

Young steer prices at Wagga were generally firm to a few cents dearer on the main runs of yearlings to feedlot orders.

The first major test of demand for store calves will be today at the special black Euroa steer sale, followed by the annual pre-Christmas weaner market at Naracoorte in South Australia tomorrow and Friday.

Aside from season, the other price driver for young cattle is the performance of the export beef market, particularly bullocks for steer traders.

Despite the drop in saleyard numbers on Monday due to the rain, there was no major price spike for grown steers and cows, with national indicator rates for these categories moving by only 1c to an average of 271c/kg for steers and 217c for cows.

Some interesting data is coming out of the US, a pivotal market for beef demand and pricing on the world stage.

US beef prices have slowed again under the influence of higher domestic cattle kills, and also more grinding beef being shipped there from New Zealand as its seasonal cull of bulls and cows builds, according to the Steiner Consulting Group, which monitors the US market on a daily basis.

Steiner said the latest slaughter data showed the US cattle kill was tracking about 5 per cent higher than a year ago, and US cow prices were now trending below last year.

It is not all bad news for Australia, with the latest export data suggesting processors have been able to divert beef to other markets that are offering better money.

Steiner said the volume of beef shipped from Australia to the US last month was well below the usual level.

Data for the month suggests just 16 per cent of Australia’s total beef sales were sent to the US during November.

Steiner reported this would be the lowest volume of Australian beef exports to the US since April, with figures supporting the view “that more Australian beef is now going to other markets rather than coming to the US”.

However, a current average of 270c/kg liveweight for a heavy prime steer does not lend itself to farmers paying much more than $1200 to $1300 for replacement store calves.

Where the store market could shift is a return to higher c/kg rates for smaller steer calves.