northern cattle

Whilst a week-on-week increase in supply is not a surprise as the trade returns from the break, it's clear that the resurgence of restocker demand has motivated auction participation by those offloading cattle.

East Coast yardings this week per the NLRS were reported at 56,836 head, which is 46% higher than the 5-year average for the same sale week.  Buyers were likely relieved there were more cattle to choose from as this additional supply did not apply downward pressure on most market indicators on a national basis.

Young cattle were in strong demand from restockers and feeders as the Eastern Young Cattle Indicator (EYCI) improved 4.7% week on week to 616 ȼ/kg cwt.  Restockers were in force across the major yards again but the instigators of bidding this week were the feeder buyers as the national feeder indicator improved 18ȼ to 325ȼ/kg lwt.  

This week’s cattle analysis by Nick Symon (read here) focussed on the buyer breakdown of young cattle at the yards and how the impact of rain has allowed for prices to trend upward despite record-breaking supply.   For prices to continue on their upward trajectory, however, we expect some more support from overseas demand will be needed. 

Processor demand for cows was evident this week as the number of cows bought by processors nationally this week at the yards more than doubled week on week to 8518 head.  This figure is the highest weekly head count for the month of January since 2019. The national processor cow indicator improved despite this, up 21 ȼ/kg to 250 ȼ/kg lwt (463 ȼ/kg cwt). Furthermore reports in Wagga saw “prolonged bidding duels” for lighter-weight cows.  

Next week

Despite recent exchange rate appreciation in Q4, 90CL pricing is still elevated. US buyers purchasing hamburger beef in 2023 was a significant support mechanism, but continued demand for 90CL beef (and indirectly the cull cows that are used for it) will be necessary to keep the good times of 2024 rolling.

Processor demand for this type of cattle is an important indicator that the export prospects look strong in the medium term which should help to enhance confidence for other cattle buyers in the supply chain.

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Data sources: MLA, Mecardo

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