27 November 2009

11 minute read

Oceania

Western Australia weekly cattle summary

Falling pastoral supplies

Another week of unseasonally cold and mild weather patterns continued to maintain itself in the southwest corner of the country with some very light falls of rainfall recorded in the far south. The grain harvest is now well under way across Western Australia (WA) and the mild weather, coupled with high moisture levels continues to plague activity. Grain quality and yields are both being quoted at lower levels than first anticipated and this coupled with the weak global demand this season should auger well for the feeder sector, who will be able to access large volumes of feed cereals this year and considerably lower rates than seen in the past five or six years. Green feed levels are now all but gone and the recent wet weather will not have been beneficial to the quality of dry feed pastures, but there was a solid amount of hay cut prior to this in the majority of areas and consequently those needing to purchase dry fodder should be able to at reasonable rates.

Cattle numbers subsided in WA’s weekly yardings. The reasons behind this are to fold, the first being a lower trade demand due to the recent fire in one of the major processor’s boning room, coupled with the higher temperatures in the pastoral regions and a subsequent decline in the volume of mustering activity. As would be expected at this time of year this was an increase in the supplies of new season vealers with the Great Southern sale beginning its tow-day sales format next week with solid supplies expected.

Trade demand remains conservative

The vast majority of new season vealers seen at all three of the major weekly sales remained of medium and lightweight. The few prime heavy weight calves in excess of 330kg lwt continue to receive a solid local trade and small retailer competition that maintains rates. The majority of medium and lightweight calves received a similar demand and competition from the restocker and feeder sectors and rates were recorded at slightly higher averages for both sexes compared to the previous week. Prime trade weight yearling volumes were again limited this week and once again met a conservative trade inquiry with the majority having been purchased by restockers and or feeders.

Heavy weight bullocks, steers and heifer volumes were also very limited. Demand from the processing sector fro these grades remained quiet as export demand still being hampered by the high value of the Australian dollar. The cow market recorded solid losses this week due to a combination of the $A coupled with the weaker processing demand currently plaguing the WA industry. Rates for heavy weight 3 and 4 score drafts fell in excess of 10c/kg lwt and this trend was also registered in heavy weight bull categories at all three sales.

Victoria weekly cattle summary

Soft demand

The Eastern Young Cattle Indicator (EYCI) best indicate the price trend for the week in Victoria, with a decent fall of 7.25c/kg cwt occurring. This brought the close of trade figure on Thursday to 294.25c/kg cwt. Price falls across all classes of cattle were recorded at MLA’s NLRS saleyards, although better quality at some sales denoted higher averages of 1c to 5c/kg, and prices for cows varied only slightly. However, a fall in supply of cows, best suiting the 90CL US market, did spark a small respite in current trends, and some prices were slightly higher. Some of the big fall in the EYCI figure was a shift in processor demand. With so many very good to top quality vealers coming onto the market now, at both physical markets and over the hooks, demand was much weaker for vealers. This was seen especially for the best quality, and mostly this trend occurred at Pakenham young cattle sale. The supply of young cattle here was larger, but over most of the state supply fell by 10 per cent. Pakenham market usually sets the top prices for the state, but prices for vealers fell up to 20c/kg. Over the hooks sales have lifted as producers scramble to offload stock, which is affecting market prices.

Demand for grown steers of all weights and grades remained poor, and a further reduction in prices occurred. The only saving grace for the week was cows, and generally for lean 1 and 2 score cows. Prices here averaged up to 3c/kg higher, remembering that with the very good season even these cows are carrying more meat.

Prices slip

Part of the issue with price trends is the quality of the beast for the money paid. The top price in the state was 197c (21c lower than last week), but top quality vealers and yearlings ranged greatly between 162c and 185c/kg for most sales. Cattle that set the EYCI figures made anywhere between 130c and 185c, but the average for C muscle cattle was close to 150c/kg. Heifer prices were generally quite poor with good quality heifers making from 110c to 155c/kg. Given good dressing percentages, the carcase weight price average was where cows were at two weeks ago, averaging only 255c/kg. Some sales of supplementary fed yearlings were noted between 135c and 175c/kg, at these prices producers could be losing a reasonable amount of money. Despite a fall in the supply of grown steers prices fell on average another 1.50c/kg.

Prices for prime C3 and C4 steers were between 131c and 163c, averaging 145.6c/kg. Demand for cows was steady with better quality cows making from 115c to 134c with most others making between 85c and 124c/kg. Bulls faired poorly as well only averaging 124c, down a further 4c/kg on average.

New South Wales weekly cattle summary

Heat drives yardings

At markets reported by MLA’s NLRS throughput increased 10 per cent as all except Casino and Inverell offered greater numbers. The recent hot weather has been a major catalyst to the increase while the declining prices may have prompted producers to offload sooner rather than later as there is little hope of improvements in the short term. When compared to last year, supply is slightly higher.

As the season varies, quality and condition of the cattle offered has again been mixed although some centres had less supplementary fed, well finished, high yielding pens available. Competition has slipped as processors in some cases have reduced shifts due to limited meat demand even though numbers are still plentiful. This resulted in a cheaper trend for the majority of categories with only a handful selling close to firm. Even though most contributors to the over the hooks report left their rates unchanged, a cheaper trend was still evident.

With young cattle accounting for 50 per cent of the total throughput, they were dealt some of the largest price reductions of 10¢ to 20¢/kg common. The EYCI has fallen to its lowest level since November 2007 and at the completion of Thursday’s markets was 294.25¢ which is 7.25¢/kg cwt below the corresponding time last week.

As the A$ remains high and impacts on export demand, grown cattle were also dealt cheaper prices. The rather small numbers at some markets was a factor behind the overall price falls not being greater. Grown steers were 1¢ to 6¢/kg cheaper while cows fell 1¢ to 4¢/kg.

Retreating cattle market

Lightweight C2 vealer steers to slaughter sold to a top of 204¢ while the medium weight lines returning to the paddock averaged 6¢ cheaper at 168¢/kg. Lightweight vealer heifers purchased by processors made to 207¢ while the medium weights held unchanged at 172¢/kg. Lightweight C2 yearling steers to restockers eased 4¢ to 166¢ while the medium weights to feed ranged from 136¢ to 171¢/kg. The heavyweight 3 scores to slaughter slipped 4¢ to 154¢ with sales to 177¢/kg. Medium weight trade heifers sold to a top of 190¢ while the heavyweights averaged 4¢ cheaper at 142¢ to top at 175¢/kg.

Medium weight grown steers purchased by feeders ranged from 135¢ to 164¢ while the heavyweight 3 scores to slaughter averaged 149¢ with sales to 163¢/kg. The 4 score bullocks slipped 6¢ in value with most sales around 150¢/kg. Grown heifers also sold to a cheaper trend as the C3’s to slaughter slipped 2¢ to 138¢ with sales to 155¢/kg. Medium weight D2 cows sold from 80¢ to 116¢ while the 3 scores mostly sold around 114¢ to top at 128¢/kg. The heavyweight 4 score cows eased 1¢ in value to settle at 121¢/kg.

Queensland weekly cattle summary

Rain badly needed

Rain is the main topic of conversation through large areas of the state. Diminishing feed in most of the paddocks across the supply areas combined with the fast approaching Christmas break resulted in numbers at physical markets covered by MLAs NLRS generally remaining close to the previous weeks high-level. The continuing hot and dry weather forced a larger number of calves into the saleyards with the vast majority being sold open auction. This trend will no doubt continue until good rainfall is received as producers opt to sell off the calves in an attempt to give breeders a better chance to survive under the harsh conditions. The overall standard continues to be mixed and apart from some well presented yearling steers and heifers the remainder of the young cattle were mostly suited to feeders or restocker's. A reasonable selection of heavy steers and bullocks were penned and a fair line-up of cows contained a wide variation in quality. Values at markets early in the week could not maintain the levels of the previous week and young cattle generally lost 10¢ and close to 20¢/kg in places.

Export grades also lost ground with heavy steers and bullocks 6¢ to 9¢/kg cheaper, while average prices achieved for cows fell 4¢ to 5¢/kg. However by midweek at Dalby values tended to stabilise following the drop in prices the previous week. Well bred lines of young cattle generally met a firm market while lesser quality categories received limited bidding from buyers. The general run of export grades of heavy steers bullocks and cows experienced very little change on the previous weeks reduced rates.

Young cattle cheaper

Calves to the trade averaged 16¢ less at 177¢ with sales to 195.2¢/kg. A small selection of vealer heifers lost 10¢ to average 178¢ with the very occasional sale to 202.2¢/kg. Lightweight yearling steers were well supplied and feeder categories averaged 5¢ cheaper at 167¢, while restocker lines lost 10¢ to average 168¢ a few pens to 187.2¢/kg. Medium weight yearling steers to feed averaged close to 167¢ and heavy classes 171¢/kg. A large number of yearling heifers came forward and lightweights to feed averaged155¢ and slaughter lines around 161¢ the occasional sale to 185.2¢, while D muscle lines averaged 144¢/kg. A very small selection of medium weight grown steers to feed averaged 4¢ easier at 162¢ and sold to 170.2¢/kg. Heavy steers to export slaughter averaged 160¢, and some to the wholesale meat trade reached 175¢/kg.

Bullocks made to a top of 167.2¢ with a fair sample averaging close to 162¢/kg. Full mouth certified grainfed bullocks averaged158¢ and sold to 160.2¢/kg. A large selection of medium weight 2 score cows experienced very little change at 108¢ and 3 scores mostly sold around 118¢/kg. Good heavy cows averaged just under 129¢ with a pen of young cows reaching 138.2¢/kg.

South Australia weekly cattle summary

Softer competition

The SA LE yarded similar numbers of 482 cattle in quite mixed quality runs that sold to erratic competition from the usual local butchers, trade and processor buyers. Naracoorte’s increased yarding of 1,205 (or 531 head more) took quite a battering from the usual SA and Victorian trade and processor buyers. There were also 1,149 mainly weaned vealers offered at Thursday’s Naracoorte first weaner sale when normally there would expected to be some 3,000 head offered. This could be due to some rainfall over the past weekend, and more on the horizon that may allow producers to wean stock and hold onto them longer, rather than sell them early with the current prices being paid. Mt. Gambier agents yarded 1,717 (or 201 head more) in reasonably good quality runs that also attracted a weaker trend, with only isolated sales seemingly out of context with other sales. Millicent numbers fell after last week’s lower prices, with 543 being offered, (or 242 head fewer) and featured mainly vealers from this well renowned district. Naracoorte’s prices for grown steers were mirrored at Mt. Gambier and may witness numbers slipping even further as margins for those steers purchased out of last years weaner sales shrivel. 

It now takes a very good quality heavy steer to top the $1,000/head mark, and when you take in all costs and consider that many steers were selling between $650 and $750/head at those weaner sales. It will be interesting to see what prices are paid at Naracoorte’s weaner sale as buyers become hesitant in paying more than $600/head.

Poor results for producers

It was not a good week for producers as just about all categories continued their downward slide. Vealer steers to the trade sold from 170¢ to 189¢ for the B muscled, and 164¢ to 178¢ for the C muscled at rates 6¢ to 13¢/kg cheaper. Feeder and restocker orders paid from 138c¢ to 174¢ for C2 steers, or 4¢ to 12¢/kg less. Vealer heifer sales followed suit with trade purchases mostly 150¢ to 175¢, and isolated B muscled sales 168¢ to 194¢/kg. This left most sales 10¢ to 13¢ cheaper, and only isolated sales dearer. Feeders and restockers sourced a wide range of quality from 119¢ to 162¢/kg. Yearling steers were 2¢ to 7¢ cheaper to the trade, with C3 sales 140¢ to 165¢/kg. Other orders secured C2 steers from 140¢ to 162¢ also at lower levels. Yearling heifers were another 1¢ to 9¢ less to the trade, with C3 and C4 sales 132¢ to 161¢/kg.

Grown steer sales were unchanged to 10¢ cheaper with medium weights most affected, as C3 to C5 sales ranged between 140¢ and 156¢, or 260¢/kg cwt statewide. Cows tended to be unchanged to 4¢ cheaper, as most sold in a 230¢ to 250¢/kg cwt price range.

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