Why Would a Flood in the Cattle States Increase the Price of Beef (Think of Supply and Demand)?
Livestock prices are on the ascension afterwards the crucial return of some pelting in parts of Queensland, New S Wales and at present South Australia.
Fundamental points:
- Analysts say subsequently 1 of the most challenging seasons on tape some good rain and a short supply of livestock has reinstalled conviction in the market
- One of Australia's largest corporate cattle producers says the pelting volition mean a turnaround in fortunes after a very dry 2019
- Live exporters saw one of the largest shipments of slaughter cattle ever sent out of Townsville to Vietnam in early January
The latest area to receive a decent drop is pastoral state in South Australia.
Col Greenfield from Billa Kalina station said the pelting was the best they have seen since the tardily 1990s.
"Nosotros had 60 millimetres, but in our immediate area they had upwardly to 10mm [and] in a week's time there will be a carpet of green," he said.
The Eastern Young Cattle Indicator is up 77 cents in the past three weeks and is now sitting at its highest level since November 2017.
Adam Cheetham, a senior analyst at Meat and Livestock Australia (MLA), said that after ane of the nearly challenging seasons on record some good rain and a curt supply of livestock is having a big touch.
"We've been on a prolonged turn down over the terminal two years so this contempo rainfall has certainly reinstalled some confidence in the market for producers," he said.
Need is however strong for Australian beefiness from overseas markets then prices are expected to remain loftier.
If the drought breaks it is possible that the prices will continue to get college, according to Mr Cheetham.
"We've seen precipitous toll movements in 2016 when the EYCI reached tape levels … so if nosotros practise see widespread improvement in conditions and above average rainfall there'south certainly room for significantly more upside in these prices."
Last year, the percentage of female slaughter reached record levels, driven past producers destocking amongst their cadre breeding herds.
Sheep prices surging at Wagga Wagga
Prices surged at Wagga Wagga saleyards in the NSW Riverina when behest hit $308 a head for heavy lambs on Thursday.
The top money went to the Rodham family from Uranquinty who sold a draft of 56 lambs weighing around 40kg dressed to Dubbo processor Fletcher International Exports.
And while the temperature nudged 40 degrees Celsius, information technology did non deter buyers from competing for the 44,000 head that were penned.
It was the third sheep and lamb sale for the year at Wagga Wagga, the largest sheep and lamb selling centre in Australia, and numbers are lifting calendar week on week, up 6000 head this week.
Wagga Wagga livestock agent and auctioneer Mark Logan tipped the market place would get dearer.
"Every bit the lamb numbers yarded in Victoria at Hamilton and Ballarat turn down the market place will start to take off here," he said.
The mutton marketplace was also firm, with heavy crossbred ewes making up to $249 a head and heavy Merino ewes sold to $229.
Many farmers are waiting to see what happens with the weather and prices.
Dubbo farmer Phil Sheridan was happy to just scout the action at the saleyards last week.
He has washed reasonably well from cattle in recent months, buying cheap in the jump and selling at present during the high, but he warned the electric current prices may nevertheless not be enough for some farmers.
"There would be people who'd need to get a lot more … especially among the breeders who have been spending $thirty,000-twoscore,000 a month on feed."
Mud means money for Qld producers
Drought-breaking rain across big parts of north Queensland has already seen prices for livestock rocket.
Ane of Australia's largest corporate cattle producers has had rain fall beyond well-nigh of its Queensland and Northern Territory properties.
The North Australian Pastoral Visitor (NAPCO) owns 14 large cattle stations, and its primary executive officer Richard Brimblecombe said the pelting will hateful a turnaround in fortunes after a very dry 2019.
"Nosotros're incredibly excited, we were really under the pump in 2019," he said.
Mr Brimblecombe said that while their cattle numbers were reduced, they probably would non need to dip into the market to restock.
"Our numbers are down from our peak at 175,000 head of cattle. We'd like to be effectually the 200,000 head marking," he said.
"But nosotros've got a big crop of weaners coming on at present so it is unlikely we volition need to go into the market place, so we've essentially kept our convenance herd intact."
With questions effectually the shortage of cattle now that rain has fallen, Mr Brimblecombe said he would await female cattle to be at premium price.
Big shipments but live exporters struggling to detect cattle
With pelting beyond some of the Northern Territory, the toll of live export cattle continues to climb.
This week, lightweight steers out of the Port of Darwin are returning $3.40 a kilogram, historically very high prices.
Livestock agent and Longreach grazier Boyd Curran said there will be fewer numbers sent to saleyards, direct to the meatworks, or on ships.
"We probably had most five days worth of feed left and and then we were in all sorts of trouble, and then this rain could non have come at a improve time. Nosotros were saved past the bell."
The Port of Townsville continues to be decorated, with several large boats departing already this twelvemonth including one of the largest shipments of slaughter cattle ever sent out of the Port to Vietnam in early Jan.
Elders livestock agent Tom Kennedy said the continued export demand and tighter cattle marketplace meant buyers like him volition have to look further afield for cattle to load onto ships.
"This rain has been widespread, its affected all of the north," he said.
Tasmania going potent
Huge numbers of sheep have been processed in Tasmania due to high demand and dry conditions.
The market there is very dependent on what happens on the mainland, but prices are generally higher due to the quality, co-ordinate to livestock reporter Richard Bailey.
"That's all grass-fed, no hormones, no grain, no chemicals, etcetera," said Mr Bailey.
"In cattle nosotros've been expecting some shortages for 18 months merely it hasn't happened notwithstanding, although it does await like it could happen soon."
Challenging atmospheric condition for Victoria farmers
Prices have spiked 40c/kg beyond all categories in Victoria, with the all-time cows for processing making up to 268c/kg and bullocks up to 600kg making 312c/kg.
Need from the feedlot sector is very strong and feed lotters take been outbidding processors at the saleyards, according to MLA Wodonga market reporter Nicole Varley.
She said it will be difficult to make full the increasing demand from export markets like Cathay which jumped 45 per cent last yr, raising the percent of the meat production being export upwardly to 70 per cent.
"Information technology's going to be a really challenging time for u.s.a. to meet the markets that we've taken on [given] nosotros've expanded export-wise," she said.
Conditions are still quite dry and farmers are doing their best to keep breeders alive or deal with the impact of recent fires.
"There are people that are moving stock around from place to place trying to get them off farm, or [have] lost stock, and again [at that place is] another hit on the overall herd size which is sitting under 25 million — which we oasis't seen for years," Ms Varley said.
Spike coming in WA
In Western Australia, livestock producers are expecting a spike in livestock prices and demand equally conditions meliorate in other parts of the country.
Concluding year, about 410,000 sheep were sent e from WA and Landmark WA commercial sheep manager Tom Bowen expected the demand for the land's sheep to strengthen on the dorsum of recent rains in other states.
"The demand coming from South Australia and Victoria is very strong. It really hasn't had an upshot [on prices] hither all the same, only information technology will," Mr Bowen said.
He said WA's flock numbers had stagnated and producers were looking to sell as dry conditions intensified in southern parts of the country.
Posted , updated
Source: https://www.abc.net.au/news/rural/2020-02-04/livestock-prices-on-the-rise-as-rain-spreads/11918180
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