We knew cattle slaughter was on the rise, and the official numbers released last week showed an interesting breakdown of what is being slaughtered. We are at a point in the herd cycle where male slaughter remains relatively steady, and it’s what happens with female slaughter that shows producer intentions for the herd.
A quick
look at Meat and Livestock Australia (MLA) weekly numbers relative to the
official Australian Bureau of Statistics (ABS) quarterly numbers tells us that
there is some differences in whats being seen by each.
In the June
quarter, the year-on-year change in the MLA numbers increased by 16%. The
quarterly increase in the ABS slaughter figure saw an increase of 23%. While MLA’s numbers indicate direction, there
is still a disparity between their numbers and the governments.
Figure 1
shows that after declining for two quarters, cattle slaughter bounced strongly
to break the 2 million head mark, and show the highest level since the end of
2019. Looking closer, in 2019 the
December quarter was 1,200 head higher than the June just gone, while September
was 100,000 head higher.
This makes
June 2024 the third highest slaughter month since way back in 2015, as it
outstripped the levels of much of the most recent herd liquidation in 2018-2019.
We’ve run
this slaughter analysis many times before, and we know that male cattle
slaughter tells us the size of the herd, while female slaughter tells us herd
direction. Male cattle slaughter for
June did reach a new six-year high, just under 1 million head, and 11% higher
than this time last year. Since
September last year, however, male cattle slaughter has been relatively steady.
Female
slaughter (Figure 2) had a massive lift in the June quarter. The increase of 36% on last year, and 32%
increase on the March quarter saw female slaughter at 1.12 million head, and its
highest level since December 2019.
Figure 2
also shows the female slaughter rate (FSR), being the proportion of cattle
slaughtered that were female. The
tipping point for the herd has traditionally been 47%. When more than 47% of cattle slaughtered are
female the herd declines. The June FSR
of 53% is the highest since September 2020, and well above the tipping point.
What does it mean?
It’s interesting that the increase in female slaughter was across all major cattle states, not just the ones experiencing ordinary seasons. This tells us that the herd has reached its peak, and is likely to decline. Male cattle slaughter is unlikely to increase much further, while female slaughter will depend on the seasons, and could climb further.
Key Points
- June quarterly cattle slaughter shows the strongest level since 2019.
- Female cattle slaughter and the proportion of total slaughter jumped significantly.
- The rise in female slaughter will see the herd move into decline.
Click on figure to expand
Click on figure to expand
Data sources: ABS, MLA, Nutrien, Mecardo
