Beef market on a roll as supply shrinks
Prices surge higher as supply tightens heading into winter and pandemic sets back US production.
THE beef market is on a roll heading into winter, with tightening supplies amid the boom season pushing prices higher.
Heavy export cattle have grabbed the limelight, with aged bullocks weighing 777kg selling to 385c/kg on Monday and cows reaching a top of 328c/kg.
Prices were boosted by both supply and demand factors.
On the supply side, cattle numbers in the eastern states dropped away as the season gains traction and feed gets ahead of stock in paddocks.
The latest available slaughter figures had production at 123,346 for the week ending May 15, according to Meat and Livestock Australia.
It shows a decline of 2 per cent on the previous seven days, with the kill rate now tracking nearly 20 per cent lower than the same time last year.
On the demand side, grinding beef prices in the US continued to improve as coronavirus disrupts cattle production in America due to the spread of the virus through multiple abattoirs.
Reports also suggest less US beef on the export stage as less animals are processed is helping support demand for Australian beef into destinations like Asia. At Pakenham earlier this week a run of 109 heavy beef cows sold to 326c/kg and averaged 312c/kg or $1813, according to data collected by the National Livestock Reporting Service.
Price averages for good beef cows have tracked over 300c/kg at most key saleyards in the past week, with plainer and dairy types generally from 250c/kg to 290c/kg.
When prices are converted into carcass rates, good beef cows were quoted above 600c/kg cwt.
The other noted trend was processors being prepared to pay more for heavy grown steers, with domestic processors pushing in for their share of cattle up to 580kg against exporters.
At Swan Hill last week a run of very good grain-fed steers, mostly Charolais and Limousin-cross, sold to 430c/kg for 550kg.
The NLRS said a run of fed steers in the 500-600kg range averaged 415c/kg or $2234.
At Wagga Wagga a limited selection of bullocks weighing from 600-750kg sold to 400c/kg and averaged 390c/kg or $2535 — a lift of 14 cents on a week ago.
Across young cattle, domestic processors are now having to pay 400c/kg plus for the best of the vealers and yearling steers and heifers that show good shape and carcass finish.
There were sales of vealers as high as 454c/kg in the past week, with the bulk of the lead calves making from 400c/kg to 430c/kg.
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