After the heat has taken some of the shine off cattle indicators in the last few weeks, a 21% week-on-week drop in supply has halted downward pricing momentum this week.
The wet spring that was forecast on the East Coast hasn’t really eventuated. Elevated stocking rates in the North, and patient restockers in the south waiting for feed have not been as present in the market as we’ve seen all year, which has impacted pricing. This week, the Eastern Young Cattle Indicator (EYCI) fell 12¢ to 825¢/kg cwt, and the search for value saw restocker interest in heifers tick upwards, improving 29¢ to 387¢/kg lwt. Processor cow tracked sideways at 362¢/kg lwt.
Per MLA saleyard reports this week, restockers from Victoria replaced absent export buyers at Wagga this week as numbers and prices declined. Roma saw consistent numbers but inconsistent weights, with the market reflecting the cattle on offer. The offering numbers were back in Dubbo but dominated by prime cattle ripe for feed, which supported pricing. Gunnedah saw more competition and higher bids for heavier cattle, and southern processors didn’t make the trip to Charters Towers this week. The return of some rainfall, either North or South, should restore restocker demand.
After a dip the week of the 10th, slaughter bounced back last week as national cattle slaughter reached 152,947 head. Processor appetites and willingness to ship cattle long distances might be slightly impacted in the current market, but overwhelmingly, the export fundamentals are still strong.
On the US demand front, domestic price pressure in the US has put beef in the spotlight, and the US announced its intent to import more Argentine beef. In reality, the uptick in Argentine beef is a stopgap until the US-Brazil trade situation improves. Until this happens, demand for Australian product looks likely to continue steady as she goes. Last week, the 90CL in Aussie dollar terms hit a new record of 1141c/kg, so demand remains at the current edge.
The week ahead….
With plenty of producers cutting for hay in the south and expectations that local grain prices are unlikely to improve dramatically over harvest, the feed aspect of the equation looks to be easing.
With rain falling in parts of southern Australia in recent days, and more set to follow, there could be increased opportunity for restocker movement in
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Lower numbers stop the drop
The wet spring that was forecast on the East Coast hasn’t really eventuated. Elevated stocking rates in the North, and patient restockers in the south waiting for feed have not been as present in the market as we’ve seen all year, which has impacted pricing. This week, the Eastern Young Cattle Indicator (EYCI) fell 12¢ to 825¢/kg cwt, and the search for value saw restocker interest in heifers tick upwards, improving 29¢ to 387¢/kg lwt. Processor cow tracked sideways at 362¢/kg lwt.
Per MLA saleyard reports this week, restockers from Victoria replaced absent export buyers at Wagga this week as numbers and prices declined. Roma saw consistent numbers but inconsistent weights, with the market reflecting the cattle on offer. The offering numbers were back in Dubbo but dominated by prime cattle ripe for feed, which supported pricing. Gunnedah saw more competition and higher bids for heavier cattle, and southern processors didn’t make the trip to Charters Towers this week. The return of some rainfall, either North or South, should restore restocker demand.
After a dip the week of the 10th, slaughter bounced back last week as national cattle slaughter reached 152,947 head. Processor appetites and willingness to ship cattle long distances might be slightly impacted in the current market, but overwhelmingly, the export fundamentals are still strong.
On the US demand front, domestic price pressure in the US has put beef in the spotlight, and the US announced its intent to import more Argentine beef. In reality, the uptick in Argentine beef is a stopgap until the US-Brazil trade situation improves. Until this happens, demand for Australian product looks likely to continue steady as she goes. Last week, the 90CL in Aussie dollar terms hit a new record of 1141c/kg, so demand remains at the current edge.
The week ahead….
With plenty of producers cutting for hay in the south and expectations that local grain prices are unlikely to improve dramatically over harvest, the feed aspect of the equation looks to be easing.
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Data sources: Mecardo; Meat and Livestock Australia
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Lower numbers stop the drop
After the heat has taken some of the shine off cattle indicators in the last few weeks, a 21% week-on-week drop in supply has halted
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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.
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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.