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Herd rebuild has hit

It’s felt like slow going, but females are finally staying on the farm. Female slaughter rates for two of the three big processing states are tracking well down on last quarter, back to pre-drought levels - and lower. The proportion of females being slaughtered is a primary indicator of how the Australian cattle herd is rebuilding or declining, and it looks like growth is now on the horizon.

Now that the Australian Bureau of Statistics (ABS) official cattle slaughter figures are only published as quarterly figures, we are turning to Meat & Livestock Australia (MLA) weekly slaughter data for some insight into how the herd is tracking since the end of 2020.

For the first quarter of 2021 to date (19th March), the Female Slaughter Ratio (FSR) in NSW and Queensland – the only two states where Meat & Livestock Australia (MLA) data is separated into female/male slaughter – has fallen 5.2 and 6.5 percentage points respectively. In the case of NSW, this puts the average quarter one FSR at 43.07%. This is 7 percentage points lower than five-year average, and slightly lower than the first quarter of 2018 – just before it stopped raining. In Queensland the FSR is tracking at 33.90% for the first quarter to date, a whopping 10.5 percentage points below their five-year average, with the FSR only coming close to this low in one other quarter in the past five years, October-December 2015.

We have to keep in mind the FSR is a percentage of total slaughter – and total cattle slaughter itself has plummeted, down 27% year-on-year for 2021 so far. This means actual female slaughter figures (and total slaughter) for both NSW and Queensland are likely to be at five-year lows for this quarter. Last week we looked at cattle slaughter overall, and established that cattle slaughter will have to be 5% higher year-on-year for the remainder of 2021 (from April onwards) to reach MLA’s forecast for annual cattle slaughter for the year.

Victoria is the other state making up a large portion of cattle processed, as we can see in Figure 2, it has been generally on par with NSW as a percentage of national totals over the past 5 years. However, female/male slaughter rates aren’t recorded there on a weekly basis. A glance at their overall slaughter for the year-to-date however, has it tracking at 31% lower than the same 12 weeks of last year. The FSR in Victoria for the final quarter of 2020 according to the ABS data was 62.62% – still high, but the lowest since quarter two in 2018. Victoria consistently has one of the highest FSR due to the impact of its large dairy herd.

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What does it mean?

A land of drought and flooding rains Australia is alright. While widespread rainfall down the east coast will give many the autumn start they were praying for (and more), putting any thought of downsizing their cow-herd out of mind, those who received all too much moisture over the past week might have no choice in the long term.

What the figures show right now, however, is that the herd decline has come to a halt. There is likely little upside left in the restocker female price, although, lower production could impact our export markets – more on that next time.

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Key Points

  • NSW and Queensland female slaughter rates (percentage of total slaughter) show a significant decline so far for quarter one of 2021.
  • Total female slaughter on-track to drop below 47 per cent of total cattle kill, the threshold indicating herd decline has halted.

*Q1, 2021 figures are calculated from MLA weekly slaughter data. 2015-2020 uses ABS slaughter.

Click to expand

Data sources: MLA, ABS, Mecardo

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