Record breaking cattle prices
The cattle market has effectively been split in two, with both restocker demand and the global impact of coronavirus having an effect on store and prime cattle.
CATTLE prices continue to gain momentum, with the Eastern Young Cattle Indicator smashing the 770c/kg mark last week.
The benchmark indicator hit 772c/kg last Wednesday, breaking the record of 762c/kg set earlier this year, before dropping back to 770c/kg on Thursday and Friday. On Monday it rose to 771c/kg.
Young cattle prices now sit about 207c/kg above the five-year-average, according to Meat and Livestock Australia.
Rabobank animal proteins analyst Angus Gidley-Baird said effectively the market had been split in two, with both restocker demand and the global impact of COVID-19 affecting store and prime cattle.
“The producer is being sheltered (from COVID-19) by the limited supply of cattle, that continues to keep prices high,” Mr Gidley-Baird said.
“It’s almost acting as beef market and a cattle market separately at the moment. We haven’t seen any great falls in finished cattle prices, but the coronavirus restaurant closures and shifts in global exports means processors and feedlots are being forced to pay a price, competing with the producer.”
Mr Gidley-Baird said rain across the east coast was contributing to the strong restocker demand of recent months.
“The fact that since February most areas have been getting good rain, that buoyed everyone’s confidence. It shows it wasn’t a flash in the pan, and there’s genuine rain adding moisture into the soil,” Mr Gidley-Baird said.
Nutrien Warrnambool livestock agent Josh McDonald was at last week’s Mortlake store cattle sale, where a yarding of almost 5000 cattle maintained the strong price trends seen in recent months.
Mr McDonald said feedlot orders supported prices throughout the sale, with feedlots sending cattle as far as Deniliquin in NSW.
“We’ve yarded almost 5000 cattle today, when usually in the winter months we’d be back down about 2000 cattle,” Mr McDonald said.
“The prices have obviously driven a lot of the cattle out. But (prices) may have reached their limit at the moment.”
Mr McDonald said he did not envisage prices softening soon, with demand for cattle still pulling on the domestic herd.
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5000 STRONG YARDING AT MORTLAKE
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