The Eastern Young Cattle Indicator (EYCI) seems to have settled into a holding pattern over the last month or so, operating in the range of between 660¢/kg cwt and 700¢/kg cwt. This week was no different, with the index oscillating down 15¢ (2%) to close the week at 685¢/kg. The Easter break brought with an expected significant reduction in eligible yardings for the index, with just 6,634 head passing through saleyards. This is less than half the 14K head average seen over the course of February and March. Given that prices also slipped despite the tighter supply situation, it can be deduced that buyer demand also backed off.
Dubbo, Roma, and Dalby took the usual lead, contributing 52% of the index volume, with steers respectively trading at 739¢/kg cwt, 754¢/kg cwt, and 739¢kg cwt. The activity was lacklustre elsewhere, in Armidale steers traded at 639¢/kg cwt, while Shepparton steers moved at 730¢/kg.
The Western Young Cattle Indicator (WYCI) rebounded upward by 49¢ (6%) for the week, closing at 714¢/kg cwt. In contrast, steer prices falling8¢ (1%) week on week to close at 642¢/kg. Vealer percentages in the index remained relatively stable at 81%, however, a big 16% week-on-week lift in vealer heifer prices provided the upward impetus in the index.
Preliminary east coast yardings overall remained subdued compared to pre-holiday volumes this week, sitting at 22,237 head. Public holidays are expected to continue to weigh on overall supply for the remainder of the month as regional easter show holidays and Anzac Day cause selling dates for some yards to be skipped.
Slaughter numbers for the week ending the 7th of April collapsed by 28% compared to the prior week, down to 81,586 head as public holidays chewed into the number of days and personnel available to process and transport cattle. The April slump in throughput is a historical feature every year, and we can expect subdued processor demand to continue until a pickup in early May as the interruption of multiple public holidays ends.
The national indicators all dipping lower can be seen as reflective of a general withdrawal of interest from buyers across multiple categories. The national restocker steer index won the wooden spoon this week, clocking in a 16¢ (4%) week-on-week fall, settling at 387¢/kg lwt.
After a momentary dip last week, the US imported 90CL frozen cow price has recovered 4¢ (<1%) to bounce back up to 850¢/kg swt, with the strengthening of the Aussie dollar against the US greenback offset by an increase in the 90CL price in US dollar terms. US cattle prices have pushed higher recently as US holidays tightened cattle supply, while processors strove to find numbers to keep up production, weighing upon cow slaughter rates. While the US drought situation has steadily improved, with the percentage of US cattle areas in drought dropping from 47% at the start of March, down to 41% currently, that still leaves many producers in a difficult situation. This means that the US liquidation phase may be prolonged. As the US herd contracts further, this will set the scene for a significantly tighter supply outlook, and elevated prices in the longer term. This is likely to create an extended period of favourable conditions for exporters of beef to the US like Australia.
Holiday Slowdown
The Eastern Young Cattle Indicator (EYCI) seems to have settled into a holding pattern over the last month or so, operating in the range of between 660¢/kg cwt and 700¢/kg cwt. This week was no different, with the index oscillating down 15¢ (2%) to close the week at 685¢/kg. The Easter break brought with an expected significant reduction in eligible yardings for the index, with just 6,634 head passing through saleyards. This is less than half the 14K head average seen over the course of February and March. Given that prices also slipped despite the tighter supply situation, it can be deduced that buyer demand also backed off.
Dubbo, Roma, and Dalby took the usual lead, contributing 52% of the index volume, with steers respectively trading at 739¢/kg cwt, 754¢/kg cwt, and 739¢kg cwt. The activity was lacklustre elsewhere, in Armidale steers traded at 639¢/kg cwt, while Shepparton steers moved at 730¢/kg.
The Western Young Cattle Indicator (WYCI) rebounded upward by 49¢ (6%) for the week, closing at 714¢/kg cwt. In contrast, steer prices falling8¢ (1%) week on week to close at 642¢/kg. Vealer percentages in the index remained relatively stable at 81%, however, a big 16% week-on-week lift in vealer heifer prices provided the upward impetus in the index.
Preliminary east coast yardings overall remained subdued compared to pre-holiday volumes this week, sitting at 22,237 head. Public holidays are expected to continue to weigh on overall supply for the remainder of the month as regional easter show holidays and Anzac Day cause selling dates for some yards to be skipped.
Slaughter numbers for the week ending the 7th of April collapsed by 28% compared to the prior week, down to 81,586 head as public holidays chewed into the number of days and personnel available to process and transport cattle. The April slump in throughput is a historical feature every year, and we can expect subdued processor demand to continue until a pickup in early May as the interruption of multiple public holidays ends.
The national indicators all dipping lower can be seen as reflective of a general withdrawal of interest from buyers across multiple categories. The national restocker steer index won the wooden spoon this week, clocking in a 16¢ (4%) week-on-week fall, settling at 387¢/kg lwt.
After a momentary dip last week, the US imported 90CL frozen cow price has recovered 4¢ (<1%) to bounce back up to 850¢/kg swt, with the strengthening of the Aussie dollar against the US greenback offset by an increase in the 90CL price in US dollar terms. US cattle prices have pushed higher recently as US holidays tightened cattle supply, while processors strove to find numbers to keep up production, weighing upon cow slaughter rates. While the US drought situation has steadily improved, with the percentage of US cattle areas in drought dropping from 47% at the start of March, down to 41% currently, that still leaves many producers in a difficult situation. This means that the US liquidation phase may be prolonged. As the US herd contracts further, this will set the scene for a significantly tighter supply outlook, and elevated prices in the longer term. This is likely to create an extended period of favourable conditions for exporters of beef to the US like Australia.
The week ahead….
Fewer public holidays next week are likely to drive a lift in both slaughter and yardings and a reshuffle of numbers into saleyards that are still operating. Historically though, we don’t see volumes recover significantly until after the disruption of Anzac Day has passed. With demand subdued, and focus shifting to cropping for some buyers; we can probably expect prices to drift sideways at best next week.
Have any questions or comments?
Click on graph to expand
Click on graph to expand
Click on graph to expand
Click on graph to expand
Data sources: MLA, USDA, Mecardo
Categories
Have any questions or comments?
Dry dictates market movement
The cattle market softened slightly this week as yardings lifted by more than 20,000. This increase in throughput was also heightened by lesser cyclone-affected yardings
Some economic theory applied to beef tariffs
With US tariffs still firmly on the agenda, and with beef and lamb possible targets, the question now is what would this do to our
Cyclone disruption halts supply
Ex-tropical cyclone Alfred has contributed to significant disruption throughout the cattle supply chain, as processors, saleyards and producers were all impacted. Consequently, this week saw
Cattle numbers hold steady and peak production continues
Both supply and demand will remain strong in the cattle industry this year according to the latest projections released by Meat & Livestock Australia this
Want market insights delivered straight to your inbox?
Sign up to the mailing list to get regular updates to new analysis and market outlooks
Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published
Listen to the podcast
Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.
MEET THE TEAM
Our team of market analysts are recognised as leaders in Australian Ag market analysis, providing invaluable insights to help you navigate the ever-changing commodity landscape.
SERVICES AND CAPABILITIES STATEMENT BROCHURE
We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.