The US manufacturing beef market reached new highs this week, on both the domestic and imported front, driven by the very tight cow slaughter over the past few months, in the wake of several years of drought. Also boosting 90CL prices is the current record high US cattle prices, again, due to the very tight supplies.
Underpinned by the high prices, which for Australian exporters has been further improved by the weaker currency compared to year-ago levels, significant changes have occurred in the Australian beef trade matrix. Shipments to the US are surging at rates not seen for many years, with the March volume projected to reach 29,000 tonnes swt for the first time since November 2008. This also places the US on track to surpass Japan as the largest market for Australian beef for the second month in a row – a sequence that hasn’t happened since 2004. Assisted by an expectation of sustained demand from the US, shipments are likely to remain high for the coming months.
Locally, the lack of sufficient rain has again impacted cattle markets, with the EYCI hovering around 300¢/kg cwt for most of the week, back 13¢ from last week, while heavy steers were steady, averaging 325¢/kg cwt.
Sheep and lamb markets also lost some ground this week, largely the result of increased supplies, however, prices remain very strong in historical terms. Heavy lambs lost 12¢, to finish Thursday’s markets on 572¢/kg cwt, while mutton eased 20¢, finishing on 298¢/kg cwt.