Crunch time

Crunch time


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Prices continue to fall, so when will store prices come to parity?

RAIN is falling, and many areas of the eastern seaboard have already had some very good falls. So with warmer spring temperatures just around the corner, will store cattle prices reach parity with physical prices?

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Strong prices: Glen and Bill Cumming, 
Glenmaggie, sold Hereford weaners at 
Rodwells Heyfield, up to $1260.

Strong prices: Glen and Bill Cumming, Glenmaggie, sold Hereford weaners at Rodwells Heyfield, up to $1260.

Landmark & Rodwells, Heyfield, and Bill Wyndham & Co, Bairnsdale, have just held their annual spring store cattle sales, and although some were cheaper, prices were very good.

Compared to fat cattle prices of that same week, steers were up to 60 cents per kilogram liveweight higher than comparable, finished cattle, of the same week.

While this is not unusual for this time of year, what is different now, is that fat cattle prices are heading south, and not looking to improve in the near future, if at all.

Plenty of feedlots fattening cattle for the domestic market would have some very expensive cattle after this week’s fat cattle sales.

While they can replenish them at reasonable prices, they would be buying them from physical sales and not store markets.

On the reverse side, producers looking to buy new season lambs in store condition are struggling to find supply, as the rain has taken many off the market.

For producers looking to fatten cattle, what are their expectations of prices into the future?

The JBS over the hooks price for their “Grass Assured” program, which is out for their own direct customers, has dropped to 560c/kg carcass weight, and will drop even further.

Bullock prices, Monday, at Pakeham, were mostly between 485 & 510c/kg lwt, so there is no hope of direct sale prices holding up for long.

A very small yarding at Pakenham offered very good quality, but prices were up to  20 cents cheaper.

A very small yarding at Pakenham offered very good quality, but prices were up to 20 cents cheaper.

Having spoken with several people from a broad area of Victoria and NSW this week and some have told of flooding on lower pasture, and others are still begging for more rain.

Some crops are suffering under the volume of recent rain, and some private feedlots have become quite wet, which hinders weight gains.

I, like many others, have some very dear cattle sitting in the paddock, and are wondering what to do. In times like this, there are no experts. Processors have dear cattle on feed, as do producers.

However, there is one big difference here, and that is, processors have the ability to cover their rear ends, are because of the current circumstances, they are now taking up that option.

The value of the Australian Dollar to drop, hard and fast, in order to improve export prospects. If this occurred, export quality beef would be taken off the local market.

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