Benchmark: What is fair value for store cattle?

Ascertaining fair value for store cattle has become a guessing game these days.


Opinion
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Trying to ascertain a fair and accurate value for store cattle has become a guessing game these days.

Trying to ascertain a fair and accurate value for store cattle has become a guessing game these days.

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This was especially the case this week when last Thursday major sales were conducted on either side of southern Victoria – one at Leongatha and the other at Hamilton with results that were poles apart.

Both areas it must be said are beginning to emerge from wet winters and, while the grass is said to growing, recent mild weather and the rapid decline in prime markets have dented the confidence of many seeking to take advantage of this year’s anticipated spring growth.

Having made the journey last week to Barnawartha – my first visit the northern market in 12 months – I had formed fairly solid thoughts on where the market might trade for this week’s big two events.

Meanwhile, I also attended an 800-head Kyneton market held on Wednesday to see how restockers there were coming to terms with the adjusting market.

Using the MLA’s Eastern Young Cattle Index as a bench mark, I have rated each of these sales in the hope of finding similarities.

At Barnawartha on September 22 with an EYCI of 515.75-cents I found that feeder steers, 360-450kg, averaged 275c/kg for a minus 2.75-point rating while lighter steers, 280-360kg, returned a sale average of 302c/kg for a plus 23.75-point result.

Kyneton results were very similar to the above-explained Barnawartha sale when the adjustment in the EYCI is taken into account. With a 507.25 EYCI on that day (Wednesday) Kyneton feeders averaged 260c/kg for a minus 16 point rating (not many of those though) while lighter steers, 280-360kg, averaged 301c/kg to bench mark at plus 26.63 points.

These two results are about where I was told the Leongatha sale traded. To be fair, I didn’t attend this sale but I have it on good authority, and from three sources the Leongatha market traded at above this money.

At Hamilton however it was a sale of another beast. Whether it was the depth of the South Australian competition – excited about its AFL football chances – had bewildered most who looked on.

Bench-marking the Hamilton sale, the results went like this. The EYCI for the day was 505.50 points – feeder steers, 360-450kg, averaged 308c/kg to rate plus 35.15 points while the lighter steers, 280-360kg, averaged 329c/kg to rate at plus 56 points.

Hamilton auctioneer Berine Grant, LMB Linke labelled the sale as “one out of the box”. 

“The results have exceeded agents’ wildest dreams,” he said. “It’s hard to believe the cattle market is as depressed as it is after seeing the intensity of the SA demand.”

The irony of this Hamilton result however was that a good following of major feeder buyers attended but fired a shot despite a good number fitting the bill.

Matt Layfield, Highland Meats, Daylesford, with wife Courtney and son Hunter, said Queensland boxed beef has swamped the wholesale market.

Matt Layfield, Highland Meats, Daylesford, with wife Courtney and son Hunter, said Queensland boxed beef has swamped the wholesale market.

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