Cattle market – September update
At a glance
- National trade steer prices reach a two year high of 527 c/kg lwt, 31 per cent (pc) higher than this time last year.
- Beef imports to China are forecast to grow by 11.4pc in 2021 with early forecasts of a 6pc increase in 2022.
The USDA released its latest forecast on China’s beef industry this week. From an Australian perspective, the positives in the report centred around increases in imports. Beef imports are expected to total 3.1 million tonnes in 2021, an increase of 11.4pc, driven primarily by a recovery in demand from the food service sector. This trend is expected to continue in 2022, coupled with rising incomes in second and third tier cities, indicating beef imports could rise a further 6pc to 3.3 million tonnes in 2022.
Supply of beef cattle continues to remain tight across Australia and competing countries. In the United States (US), high grain prices have led to lighter turn-off weights, resulting in a softer production forecast. In contrast, Brazil’s cattle herd is expected to grow by 4pc in 2021 and 2022 as producers look to hold onto cows and take advantage of record high prices.
Confidence continues to grow for Australian producers buoyed by rainfall, feed availability and high beef prices. The Elders Weather rainfall outlook for September suggests multiple cold fronts across the country from the 11th onwards. These are expected to bring widespread rainfall in what is shaping to be a wet spring.
National steer prices were relatively flat in August as average yarding numbers edged higher. National trade steer prices reached a two year high of 527 c/kg lwt, 31pc above this time last year, while medium steers eased 3pc to 420 c/kg lwt, 16pc above year ago levels.
At state level, New South Wales trade steers recorded a 3pc gain on this time last month, reaching a two year high of 539 c/kg lwt. While Victoria and Queensland recorded strong growth in medium steer prices, increasing by 11pc and 8pc respectively.
- Increasing demand for beef in a tight supply environment.
- Seasonal conditions remain conducive for re-stocking.
- Yarding volumes are edging higher.
- High beef prices are cutting some consumers out of the market.
*Last available price.
Note: States without sufficient data for the current month or without data for a specific stock category will not appear in the table.
**The forecast shown on the graph is derived from an auto regression model (ARIMA) which was used to generate the high and low 68pc confidence interval. The ARIMA model draws on data from 2016 to now. The model is purely mathematical and should only be used as a guide for where prices could land in the next two months.
Sources: USDA and price data reproduced courtesy of Meat & Livestock Australia Limited.
The information contained in this article is given for the purpose of providing general information only, and while Elders has exercised reasonable care, skill and diligence in its preparation, many factors (including environmental and seasonal) can impact its accuracy and currency. Accordingly, the information should not be relied upon under any circumstances and Elders assumes no liability for any loss consequently suffered. If you would like to speak to someone for tailored advice relating to any of the matters referred to in this article, please contact Elders.
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