THE current demand for weaner cattle is expected to continue to at least September when the next new wave of breeder cattle is due to enter the market.
That's the view of Elders national livestock manager Chris Howie who said from Adelaide recently that demand is not expected to back-off any time soon, with perhaps a period in June and July when feeder steer prices could spike.
This forecast for continued higher prices, Mr Howie said, will be highly dependent on follow-up rains and when and where they might fall.
The best of the country and where most of the demand will emulate from is Gippsland through to New England – in the NSW Tablelands country – where the seasons are providing demand underpinned by current prices received for cattle being sold to processors, feedlot and exporters.
Elsewhere and inland seasons are patchy including the Riverina and west, all the way and into South Australia.
Central Queensland is good while western Queensland is patchy, Mr Howie said.
Northern NSW is also patchy; some parts have received rain and others not.
He said those that have received rain will need another fall within six weeks prior to the weather starting to turn cold.
"What the country needs is a big 'truck-stopping' rain," Mr Howie said.
When it does, he said it will help to determine where the affordability in cattle prices lie and where the absolute market top might be because without such a weather event the absolute top is likely to remain unknown.
"We (Elders) believe this current market is not going to back-off any time soon," he said.
"The demand for restocking and slaughter stock is keen from the smallest, lightest weaners to the heaviest bullocks and the depth to this competition is very strong and indications are it is ongoing.
"And, it is slightly different now than to what it was a month ago when the Western District and the northeast sales were being conducted.
"At that time there wasn't a great deal of enquiry for the lightest of the weaners – firstly because there were few in the market of that weight and secondly because the northern inquiry for these longer term cattle wasn't well established or had not settled on an acceptable price range to buy in.
"But now with the advent of these follow-up rains the demand for lighter cattle has fully matured which is why we believe the East Gippsland sales and perhaps even the Tasmanian series – can expect the fullest competition across all weights.
"However the money that we see in the south over the remaining sales will be 'freight relative' to where the next big rains fall.
"Presently we have seen mid-weighted weaner steers make up to 300-306c/kg live weight in the north at Tamworth, NSW, and grain-fed bullocks, 660kg, up to 260c/kg lwt and better at Dalby, Qld."
Relevant to the cost of freight, it is not inconceivable to think that weaner calves in the mountains could make 240-265c/kg lwt for steers and 220-250c/kg for heifers.
Mr Howie said that the northern live export demand for shipper cattle has also provided a solid floor to the market.
There have been a number of boats loaded from Townsville bought at 230-240c/kg cost on ship, he said.
The entry of Vietnam as a significant importer of cattle shows there is a good depth to the live export demand.
"We (Elders) are confident these trading levels reflect what the domestic and international markets are basing their pricing on," he said.
"The Australian dollar trading at current levels also has a significant impact on prices being received."
"There is a shortage in supply availability of cattle in Australia due to the record kills and seasonal conditions over recent years. The cattle industry needs some breathing space to rebuild breeding herds to provide the volume of cattle required for backgrounding, feedlotting, processing and export demand.
"And this will become even more magnified if and when the producers get a run of seasons that would allow for the retention of heifers to commence a rebuilding phase of herd."