Restockers paying 50c/kg less than last year
Find out why February will be an important month for the cattle market.
RESTOCKERS are paying 50c/kg less at live weight for store cattle compared to this time last year with prices set to fall further if more rainfall doesn’t eventuate this month.
February is shaping as a crucial month for cattle market expectations in 2018 with rainfall events in needy parts of Queensland last week set to have little impact on falling prices without follow up.
While some areas recorded upwards of 100mm from the wet change last week, for many producers it was still a sparse event.
A smaller yarding of 3800 head at the Roma store sale on Tuesday reflected where the heavier end of the western falls were received and saw the market kick at least 7c/kg in some categories, according to MLA, while finished cattle grids remained steady.
But MLA Market Insights Analyst Tim Ryan said without a solid break and the wet season drawing to a close, it didn’t give much support for the year ahead.
Compared to this time last year, MLA reports that the eastern young cattle indicator for intend to kill carcass weights is back about $1 while restockers are paying 50c/kg less at live weight for store cattle.
Mr Ryan said feedlot finished cattle prices had come back and grain prices were high meaning feedlot demand had tempered in comparison.
With the cattle herd still at a historic low, he said rain would be integral to the rebuild process.
“At the moment it’s definitely restockers paying the premium in the market...over the feeder and processor buyers,” he said.
“I think that really reflects that intent to rebuild and over the last 12 months there is a start to that herd rebuild but it is really going to hinge on how this wet season in Queensland follows up.
“Queensland really has the biggest deficit of cattle...it has about half of the beef herd so it has a big impact on markets across the country.”
In the north, rain was also patchy and isolated with varied falls recorded. Elders Charters Towers livestock agent Brent Williams said it would impact the cattle market in the coming week, but if more rain didn’t arrive they would see a decline.
"We had falls of up to about 100mm around town (Charters Towers), but out of town some places saw 20mm - if that,” he said.
"The market is quite stable at the moment, we have boats leaving Townsville at about $3/kg.
"The Charters Towers store sale held steady last week."
Longreach agricultural consultant Peter Whip drove south of Longreach on Tuesday and said the stretch to Blackall showed the rain was clearly to the north.
He said many people in those areas were hanging on to their core breeder herd and would make the decision about offloading at the end of February or early March.
"The guys that got good rain, obviously they will look at restocking, but it wasn't widespread enough," he said.
"In the central west I think it was pretty disappointing generally, if you weren't one of the ones who got under it. A lot of that country has almost had it."
As the Queensland Country Life went to print yesterday, the Dalby store sale was underway with early bullock and cow sales showing a kick of 8c/kg to 10c/kg.
More than 4000 head were yarded with store cattle from as far as Cameron Corner. Elders area manager Ashley Loveday said regular buyers were all present and operating with next week’s sale to show the true impact of recent rain on the market.