Cattle prices feel the heat
Cattle market continues to drop.
CATTLE prices continue to fall under the pressure of subdued restocker interest and competitive tensions at the finished end.
The influx of additional weaners from producers in some pockets who are looking ahead at dry conditions and the likely setting in of lower prices has added extra downward pressure to younger, lighter cattle prices.
The benchmark Eastern Young Cattle Indicator (EYCI) is tonight sitting at 540.50 cents per kilogram carcase, weight, down 10c on Monday and 109c on this time last year.
With weather models not pointing to any decent rain across cattle growing regions in the next week, restockers are not likely to shift much from their current coursein the short term.
In that context, the herd rebuild is slowing, if not reversing, for the time being, agribusiness analysts report.
It’s too early to say if the weaner offloading being reported in southern and central parts of NSW is the start of what will be a wider trend, they say.
However, the Bureau of Meteorology (BOM) outlook for average to slightly above average rainfall for the next three months should favour restocker buying of EYCI eligible cattle, particularly for northern NSW and Queensland producers, Meat and Livestock Australia market analysts say.
Indeed, specialist weaner producers in these regions report “all is on track” for top-quality offerings and expected volumes at annual autumn weaner sales.
Meanwhile, there are signs of some easing in the difficult export trading environment that analysts say had led to a decline in over-the-hooks(OTH) indicators for much of January.
The Commonwealth Bank’s Tobin Gorey says United States finished cattle prices are on the rise and that should offset the grinding gains of the Australian Dollar.
MLA says improved seasonal conditions across much of the country may also provide support to OTH indicators as buyer competitions strengthens.
MLA’s 2018 cattle projections are due to be released next week.