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MLA Meat and Livestock Weekly

Meat & Livestock Australia

Categories: Beef, Sheep & lambs, Commodities

The latest BOM seasonal outlook, combined with the recent appreciation in the A$, points to a likely continued tough finish to 2013 for the cattle market, as the steady supply of cattle continues to be absorbed by a limited field of buyers. With drought spreading through Queensland, along with northern and western NSW, restocker and feeder demand has dried up across major selling centres, with feedlots and processors the main purchasers.

While the solution to the current tough seasonal and market conditions is very simple, rain, the latest outlook points to the next three months being hotter and drier than average. Given the dry outlook for the remainder of 2013, adult cattle slaughter is on track to exceed 8 million head for only the second year since 1980 – which would be at least a 9% increase on 2012 (7.352 million head).

While the one big positive for the cattle industry in 2013 has been that the additional beef being produced has been sold quickly to overseas markets, the recent rise in the A$, trading over 97US¢ this week, could serve to dampen demand. After the first three weeks of October, Australian beef exports stand at almost 68,000 tonnes swt – on track to exceed the previous October record high set last year. The potential all-time high October exports will only accentuate the beef surge registered so far in 2013, with shipments for the first nine months of 2013 already up 15% year-on-year, totalling 800,000 tonnes swt.

Cattle prices were lower overall this week, with the EYCI falling to its lowest level since mid-May, finishing Thursday at 290.50¢/kg cwt. Nationally, cows averaged 255¢, while heavy steers finished the week at 325¢/kg cwt, as the availability of well finished cattle in northern markets reportedly decreases.

Source: Meat & Livestock Australia

 

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