Store and prime prices take a hit across markets

The heady days of consecutive price records are over as cattle producers come to terms with the new norm.

Cattle producer returns are buckling as prices fall across prime and store markets.

The Eastern Young Cattle Indicator dropped below 700c/kg last week, the first time since 2020.

While it had climbed back to 701c/kg on Monday, it is still 428c/kg or 38 per cent below this time last year.

Bigger offerings in a flow-on from the herd rebuild are being blamed for at least part of the price fall, with last month’s national cattle yardings up 5 per cent year-on-year.

The lower prime returns are sapping both confidence and spending power from producers and there’s also talk of a drier year.

Some prices were back by more than $1000 on last year at store sales in the past week.

Last week’s mountain calf sale values were back by $1000, in some instances, off the back of record prices last year.

Meat and Livestock Australia markets analyst Jenny Lim said there was a trifecta of reasons for the lower prices.

“Fatigue from some buyers after the sustained high prices of 2022, the easing of restocker sentiment in southern states and the increased offerings are contributing to downward pressure on prices,” Ms Lim said.

Simon and Sonya Lawlor from Omeo cannot fathom why cattle prices have fallen as far as they have.

Omeo producer Simon Lawlor said it was difficult to understand what had caused the drastic fall in prices both at a prime and store level.

“I am a little perplexed why the cattle market has dropped to the depths it has,” Mr Lawlor said.

“There is no real reason that I can put my finger on as to who it has dropped as far as it has – there is no significant dry area, and there have been no major incidents (to stop demand) and I feel the fundamentals of the industry are healthy.

“The world still likes protein and especially the quality that is produced in Australia.”

Elders national livestock manager Peter Homann said the lower prices did offer opportunities for those who wanted to restock.

“It is definitely a good time to buy cattle,” Mr Homann said.

“But we feel like the cattle job has bottomed out.”

Meanwhile, there appears little upside for Australian beef producers from the single case of bovine spongiform encephalopathy in Brazil found last month.

The US-based Steiner Consulting Group said it expected the suspension of beef exports to China to only last for a few weeks and should be resolved by the end of the month.