On the east coast heavy steer pricing saw marginal improvement as Victoria rose 2¢ at 295¢/kg lwt and a 10¢ increase was seen in NSW, ending at 298¢/kg lwt. The declines in the cattle market have not been as steep for finished cattle as opposed to younger cattle, which has most likely appealed to those getting the rain. The spread between National Heavy Steers to the EYCI now sits at just a -4% difference as opposed to the -19% in June last year.
Processor cows in Victoria didn’t change at 224¢/kg lwt, gained 2¢ to 205¢/kg lwt in NSW and lost ground by 13¢ in Queensland finishing at 194¢/kg lwt.
Initial data signals a significant jump in yardings this week compared with the 26k that made their way to saleyards last week. This looks to be driven by Queensland where numbers have more than doubled, (6k head for the week ending 7th July to just under 20K this week). After the unseasonal rainfall in large parts of Queensland in recent weeks this isn’t surprising. What has been surprising has been the continued expectation-defying rainfall throughout winter allowing some producers to hold onto cattle in a depreciating market.
Feeder steers heading to saleyards for the month to date nationally sit at 24k head, while the average head for July since 2018 has been 42k. We know that there is plenty of supply so unless significant numbers of feeders arrive next week, we might be seeing evidence of growers rolling the dice on fattening cattle whilst feed is available. Argus has reported that competition for feeder steers is ramping up with growers’ intentions to hold onto stock creating some urgency amongst feedlotters. The national feeder steer indicator is up to 319¢/kg lwt, an increase of 3¢ for the week.
East coast slaughter for last week was down 5% week on week to 114k. The supply situation is impacting seasonality as slaughter is up 22% on the same time last year.
The World Meteorological Organization has declared El Niño, but the BOM haven’t joined the fray despite being the most bullish on the outlook earlier this year. If supply heading to market spreads out as opposed to bottlenecking as a result of available feed and procrastination of turnoff, pricing should find support as long as export demand continues to track stronger this quarter.