It has been a tough year for southern cow/calf producers. The autumn and winter saw plenty spent on supplementary feed, and with the short season rapidly coming to a close, minds are turning to weaning cattle for sale at the annual sales. Here we look at possibilities for pricing.
The cost of production of southern weaners this year has been
considerable. Every situation will be different,
but we can expect these expensive weaners might also be lighter given the slow
start to the season. As such producers
will be hoping for an increased rate in cents per kilo to offer some returns
from the tough season.
If we look at recent weaner prices from online sales, there is some good
news. Cattle prices in general are
higher than this time last year and higher than the January weaner sales
levels. Figure 1 shows Angus weaner
steer prices for cattle in the 250-300kg range.
The 2025 figure is a rough price from AuctionsPlus sales over the last
few weeks and the Eastern Young Cattle Indicator (EYCI) from last week. Weaner prices are around 70¢/kg lwt higher
than January, at 380¢/kg lwt. Weaners
are also at a stronger premium to the EYCI than in January, but 2024 was an eight-year
low.
Working on 280kg steer prices come out in the $1000-1100 range, which,
while being much better than the pre-2017 price lift, won’t be that exciting
for producers.
For those looking to buy weaner steers prices currently look ok, if feed
is in the form of grass rather than supplements. Export feeder prices have dipped recently and
are around the 350¢/kg lwt mark, but this could be expected to be close to the
annual low, based on historical seasonality.
Any upside in feeder prices from here would be making the weaner steer
trade more attractive.
In terms of price movements between now and January for weaner prices,
it’s best to refer to the Mecardo article on the impact of the northern wet season
released a fortnight ago (read more
here). Some rain has fallen since
then, but it has by no means been widespread enough to spark a run on light
cattle.
The forecast for the coming eight days is positive for a start to the wet
season, but some follow-up will be required to see a sustained rally.
Figure 2 shows potential trading scenarios for buying autumn drop
weaners. This trade scenario calculation does not allow for any feed, freight, or
administrative costs; these will vary between enterprises and should be
calculated on a case-by-case basis when considering any trade.
What does it mean?
Looking at the Bureau of Meteorology’s (BOM) three-month outlook there appears to be good probability of summer rains and subsequent support for young cattle prices over the coming months. Weaner supply is something it’s hard to get a handle on, but it’s likely to be weaker this year. As such a confluence of tighter supply, and rain-driven demand could drive weaner prices well into the 400-500¢ range in January.
Key Points
- The southern autumn drop weaner sales will kick off next month, with prices currently a little stronger than last year.
- Historically weaner prices are ok, but production costs have been much higher this year.
- There is room for price upside with summer and rain-driven demand..
Click on figure to expand
Click on figure to expand
Click on figure to expand
Data sources: MLA, AuctionsPlus, BOM, Nutrien, Mecardo
