Eastern Young Cattle Indicator surges to another new record

Cattle prices continue to smash records, with the crucial Eastern Young Cattle Indicator surging yet again — but the long-term impact could be detrimental for Australia’s livestock industry. This is why.

Cattle prices continue to rise. Picture: Zoe Phillips

CATTLE prices have again surged to new record highs, continuing the trend of the past 12 months.

The Eastern Young Cattle Indicator closed yesterday at 872c/kg, a jump of almost 30c/kg since the beginning of the week.

This time last year, the EYCI was 525.25c/kg, more than 340c/kg less.

Thomas Elders Markets livestock analyst Matt Dalgleish said prices were beginning to reach “beyond what I would have suspected would make rational sense”.

Mr Dalgleish said high prices for lightweight weaner cattle in recent weeks could be the cause for the strong lift in the indicator price, as buyers shell out more money for light calves.

And with Australian cattle now some of the most expensive in the world, Mr Dalgleish said the livestock industry could be affected in the long term, with the potential for US red meat exports to undercut Australian exports.

“The impact is twofold. It’s not just high domestic prices, and the prospective of the US going into a destocking phase (from drought), which is often associated with lower prices,” Mr Dalgleish said.

“The Australian dollar is also continuing to rise. So not only are domestic cattle prices beginning to rise, it’s also other associated things like the dollar situation, and the US being more and more competitive … there is the potential loss of some market share.”

Mr Dalgleish said the “only saviour” for the Australian red meat industry was tighter supply of domestic cattle could see a reduction in export volumes, with the potential to cushion the industry from the impact of high prices.

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