First real measure shows El Nino call caused major sell off

The first real measure of how El Nino predictions influenced beef producers has found it had a major impact on destocking. We break down the figures.

The first real measure of how predictions of El Nino impacted beef producers decisions has shown it had a major impact on destocking.

Almost half of Australia’s cattle producers are reducing their herd size according to a major survey of their plans.

And of those who are decreasing numbers, 66 per cent said they were doing it due to low rainfall or talk of dry seasons ahead.

In a first for the beef industry, Meat and Livestock Australia questioned producers on their intentions for the coming year with responses sought last November.

And while better prices may have changed some plans, the Beef Producer Intention Survey showed both southern and northern cattle producers would have smaller herds.

The feedback showed producers took weather forecasts and current conditions into account when deciding how their herds would

Volatility in prices was the next reason given, but it wasn’t the major cause for reducing herds.

The survey showed the herd reduction would include culling more older cows than normal and selling more heifers intended as replacements than normal as the major two ways they would decrease numbers.

The herd reduction was consistent across Australia, the survey found.

“Producers’ intention for their on-farm grass-fed adult beef cattle herd over the next 12 months was consistent between southern and northern producers,” the authors said.

“While there are mixed responses (some increasing, some decreasing), around one in seven (about 15 per cent) are indicating no change.

“The result suggests most producers will make some change to their current herd sizes over the next 12 months.”

Even with almost half of producers saying they would be keeping fewer cattle, the national herd of grass-fed cattle is expected to rise this year compared to last, lifting 1 per cent to 24.44 million.

Some of the other major findings from the survey included grass-fed beef herd sizes, with southern Australia wrestling the mantle from their northern Australian cousins.

The results showed there were an estimated 12,270,400 adult cattle running on pasture in southern Australia compared to 11,939,790 in northern Australia.

There were also more breeding cows in grass-fed systems in the south compared to the north.

The survey also detailed breeds, with few surprises in the breakdown.

Angus dominate southern grass-fed breeding operations, making up 72 per cent of herds in Victoria, compared to the next biggest, Herefords, at 11 per cent.

But 82 per cent of breeding herds in Tasmania are Angus, and 67 per cent in NSW.

MLA embarked on the survey to add to the information base for producers to help with decisions, which includes the organisation’s cattle projections released last month.

About 3800 producers responded to the survey and estimates in the report were made from weighted survey data.

MLA said weighting of the survey data was important to ensure the producers who responded were representative of Australian grass-fed beef cattle producers more broadly.