With some 10,000 head sold in four sales – majority being Angus steers – an average of 385c/kg or $1380 a head has rekindled closing 2016 market rates.
Without doubt this has delivered a renewed wave of confidence that current slaughter rates “may” endure at least until the back end of winter.
The primary motivation behind this renewed wave of confidence has been the participation of the nation’s two largest beef processors.
JBS Swift, which has to date gathered some 2000 steers for placement in Tasmania, and Thomas Foods about 700 EU-cattle to benchmark demand.
Unlike a similar move JBS undertook some years ago its order has ruffled few feathers particularly of its own Alliance suppliers who have competed in opposition.
Central to the exporter’s primary objective is its desire to fill a perceived void in its Tasmanian winter supply that produces a range of highly regarded branded products from its Longford factory.
Kerr & Co, auctioneer Craig Pertzel said after Monday’s Hamilton Angus sale that not only had its activity underpinned demand but it had also underpinned the thinking of others.
“There is an obvious sense of belief that if they (JBS Swift) can buy at this money so can others” Mr Pertzel said.
However, the extra weight that this year’s calves have offered – Hamilton yardings have averaged 355kg - has helped retain most of the cattle sold to the southern states, with few (10pc) drifting north.
Other major buyers to date in the four southwest markets has been West and South Gippsland, southeast SA but Western Victoria itself has possibly purchased less than 10pc.
One of the main discussion points that has been mulled over in the many evening chit-chat sessions that have followed Hamilton sales has been the length of time the market has to run at current rates.
Thoughts have varied broadly, from a few months to several years. But the common theme has always returned to focus on the availability of supply (depleted) rather than the related effects of global demand and depressed world-market pricing.
Another discussion point has been the success or otherwise of AuctionsPlus and its participation in this year’s southern weaner series.
While I believe it will become a valuable marketing tool for saleyards in the future it has not set the world on fire buying one pen in three sales I’ve observed.
At Hamilton Tuesday it had 3300 catalogue views, which converted into 63 registered bidders placing three unsuccessful bids.