Early selling tempers cattle market
SEARING temperatures, hot winds and pastures drying off has cattle producers across a large swathe of NSW discussing their marketing options before the markets fall further.
But those discussions could be a little hasty in some districts with livestock agents advising clients it may not be “panic stations” just yet.
Agents are advising clients to hold onto stock, if they can, as there’s already plenty of cattle on the market putting pressure on prices.
McCarron Cullinane director Lindsay Fryer, Orange, said it’s the bigger supplies of cattle coming onto the market due to hot weather that’s pushing it down.
“The feeder type steers were about 20c/kg cheaper (most ranged from 270c/kg to 300c/kg) at Carcoar prime sale on Monday,” he said.
“The numbers should continue for a few more weeks if it stays dry and that’ll keep a lid on prices short term.”
“We are certainly not going to see the highs of last year, but historically the market overall is still pretty good,” he said.
“When you consider the season in the Central Tablelands has dried off this month, the market at Carcoar store sale last Friday for steers and heifers was strong, and the lighter cattle was where the market was strongest.”
Bob Jamieson Agencies director, Bob Jamieson, Inverell, said it’s certainly not on the knife edge as far as the season goes.
However, if we don’t get rain in the next two to three weeks, some people may start discussing marketing options if it looks like staying dry. “But it’s certainly not ‘panic stations’ yet,” he said.
Mr Jamieson estimated that without rain in the next few months we could be looking at an EYCI figure around the northern weaner selling season (March/April/May) of 520c/kg (carcase weight), but if there was widespread rain the EYCI would be closer to 600c/kg.
“It is dry around Inverell, however, there is a good body of dry feed to keep cattle producers going,” he said.
That reflects the positive sentiments from the Bureau of Meteorology which had forecast a wetter than average February to April for most of eastern Queensland, and roughly equal chances of a wetter or drier February to April in other parts.
At the same time, there may be some relief from the extreme heat as February to April daytime and night-time temperatures were likely to be cooler than average for parts of western, northern and south-eastern Australia.
Tim Schofield, Elders Cooma, said the late spring break on the Monaro meant graziers were only just starting to notice pasture drying off.
“A guess there are some people with surface water starting to run a bit low, but that’s not really a widespread problem for people just yet,” Mr Schofield said.
“We still have feed and the season’s not forcing people to sell stock yet.”
He estimated there would be enough dry feed to see people through to selling their Monaro weaners in March. “I don’t expect we will be seeing too many of those young cattle coming onto the market early,” he said.
R.H. Blake and Company livestock manager, Mark Logan, Wagga Wagga, said generally January was “an ordinary” month to be selling cattle and he hoped the market improved in February and March.
“The prices so far in January have been a bit disappointing, particularly for the export weight cattle (due to the Australian dollar) and the well finished trade cattle,” he said. “There’s also still plenty of feed so anybody who does have unfinished cattle on-farm should be holding onto them.”
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 of the state 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) finished Tuesday’s trading at 540.50 cents a kilogram (carcase weight), down 10c/kg on Monday and 109c/kg 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 course in the short term.
In that context, the national herd rebuild is slowing, if not reversing, for the time being, agribusiness analysts report.
Tony and Anne Bishop, "Myrabluan", Dunnan via Scone, have been selling cattle for several months due to the drought in their district.
“We have always sold our cattle in the dry times rather than feed them,” Mrs Bishop said.
The couple sold another 118 cows with calves at the Dubbo store sale last Friday. Their top line sold for $1020 a unit.
“We are just running out of feed, so it’s been sad to see the cows go,” she said.
Mr Bishop said in the past financial year they had sold 611 head due to the dry seasons.
They sold another 97 heifers this week.
“The brothers to those heifers were sold back in October,” Mr Bishop.
“It’s certainly evident there’s been a drop in the market from when we sold the steers.”
Meanwhile, there were signs of some easing in the difficult export trading environment that commodity analysts said had led to a decline in over-the-hooks indicators for much of January.
The Commonwealth Bank’s Tobin Gorey said US finished cattle prices were on the rise and that should offset the grinding gains of the Australian dollar.
Meat and Livestock Australia have reported US imported beef prices continued to edge higher as a result of lower offerings from Australia and New Zealand and further weakness for the US dollar this week.
The imported 90CL beef indicator moved US1 cent a pound higher from the previous week, to US204c/lb CIF (in Australian dollars back 4c/kg, to 564.10c/kg CIF).
For the most part, MLA said overseas packers appear to have ample orders in place through to February and were therefore happy to hold firm on prices.
Meat and Livestock Australia said improved seasonal conditions across much of the country may also provide support to over-the-hooks indicators as buyer competition strengthens.