A poor finish to winter, accentuated by the very warm start to September, has placed increased pressure upon the need for the spring break to occur sooner rather than later across many regions of NSW and southern Queensland. The easing of cattle prices throughout August has largely mirrored the steady deterioration in seasonal conditions, especially following a relatively optimistic start to winter for most of southern Australia.
With dry conditions prevailing, the pressure upon cattle prices is expected to continue until some widespread falls are recorded across the key cattle regions. While the latest three month rainfall forecast by the BOM indicates a 55-60% chance of above median falls for spring, the outlook for the immediate week is patchy. Indeed, if recent warm temperatures continue to draw moisture from crops and pastures, a delayed spring break could be too late for many producers – placing the market in a similar position to the corresponding period in 2012.
This week saw another weakening in the cattle market, as demand remained limited at the larger selling centres in NSW and Queensland, and consequently, the benchmark EYCI finished Thursday at 312.5¢/kg cwt – the lowest level since midJune. Nationally, the cow market slipped another 23¢, to average 255¢/kg cwt, while heavy steers direct-to-works in Queensland averaged 305¢/kg cwt.
As is often the case across the vast expanse of eastern Australia, the reaction to the warm start to spring in parts of Victoria and southern SA would have been more welcoming, encouraging pasture and crop growth after a wetter winter than northern counterparts. While this may help to initially tighten numbers, as producers make the most of early spring growth, further rain will be crucial throughout spring to maintain momentum.