Prime cattle: drought drives down prices

One needs to look north to explain some of the impact on cattle prices, as the continuing drought in northern NSW and western Queensland influences a large increase in supply.

While we are seeing little of this in Victoria, the volume of cattle purchased in NSW for slaughter in Victoria has increased along with the supply.

Both export and local processors are sourcing cattle as far north as Dubbo, NSW, where 6250 cattle were penned last Thursday a record number. Many trucks have come south over the past weeks but none as many as the past seven days. Processors are buying in the north to stop a shortfall from Victorian sales but this has led to prices falling here.

The general downward trend of prices ranged from 10-20 cents a kilogram lower with some less than this but a reasonable number of sales were up to 33c/kg lower.

Wodonga was possibly the only market showing a reasonable drop in supply with 500 head fewer penned. But with every other sale offering a supply increase, demand was again weaker.

It is significant to look at other markets in the north of the State and the Riverina as well, as Swan Hill, Kerang, Deniliquin, NSW, and Finley, NSW, all increased with extra cattle coming to these centres from the north.

It was a late finish at Kerang last Thursday with the sale finishing under lights.

While prices were lower, there were some positives with the best quality cattle in each class selling to the best demand.

Isolated sales of high quality vealers, supplementary fed and grain fattened selling into the high 220c/kg range. Yearling steers sold from 195-215c/kg for select quality, while the highest price for prime bullocks was 197c/kg.

Along with the larger supply came poorer quality, which gave feedlots and restockers the chance to buy at lower rates. However, without this competition prices may have been even lower.

A broad spread of prices ranged from 125c/kg for heifers to 185c/kg for quality steers.

The best indication of how young cattle prices fared is the EYCI figure, which at the close of trade Tuesday was 302.75c – down by 13.75c/kg week-on-week.

Prime steer and bullock prices came back to near equal that of those in the north.

At Pakenham on Monday, a producer who has sold a pen of prime Angus bullocks for the past three weeks was paid 192c this week, against two weeks ago receiving 205c/kg for weights averaging 640kg.

An easing in demand from the US for 90CL grinding beef and a general increase for better quality cuts in other countries aligned with a rising Australian dollar to reduce cow prices.

Hardest hit were the poor quality 1 score cows with low meat yields which sold mostly from 50-90c/kg.

Slightly better quality sold from 90-120c/kg, with most better quality beef breed cows 125-148c/kg lwt.

Carcase weight price averages across NLRS reported markets varied between 227-267c/kg with the average closer to 240c/kg.