Tim Delaney, Olivia Agar: Spring rain boosting producer confidence, livestock prices

Following a horror few months for livestock producers, there are signs of hope with improved summer forecasts improving enthusiasm and prices.

Rain has injected much needed confidence and enthusiasm into livestock markets in a much needed fillip for the industry.

After months of declining values, there are positive signs – and price rises – in both store and prime markets.

And analysts say it’s rain that has changed the sentiment of the market over anything else.

The benchmark Eastern Young Cattle Indicator has gained almost 100c/kg in the past month, and closed on Monday at 449c/kg carcass weight.

There’s also positive news for sheep producers, with the heavy lamb indicator gaining 20c/kg in the past week to nudge above 500c/kg carcass weight early this week and talk of contracts of 600c/kg-plus for export weights delivered in January.

In the store markets, where producers are the major buyers, rates for lambs to fatten were higher in Deniliquin while Mortlake’s cattle offering of more than 4000 was up to 20c/kg dearer for steers and 60c/kg for the best heifers, according to National Livestock Reporting Service reporter Tim Delaney.

Mercardo analyst Olivia Agar said the forecast rain along the east coast “could put further positive sentiment in the cattle market”.

The benchmark ECYI has gained almost 100c/kg in the past month.

“With the festive season closures just a month away, all types of buyers will be making sure they have what they want before the break,” Ms Agar said.

“Rainfall in the right areas could prompt producers to hang onto cattle in the new year as well, in the hope the price trends will continue in the current direction.”

Ms Agar said the rain predictions and the markets’ response to them showed the extent the season played into the lack of confidence and the horror price run for livestock this year.

“The memory of the past drought was so fresh in people’s minds that they were driven to take a risk adverse approach to managing their herds and flocks, and sold down their numbers,” she said.

“But when you look at the Bureau of Meteorology forecasts, which went from predictions of an extreme summer to now a more moderate forecast, perhaps that has added more confidence to the market too.”

Corcoran Parker director Justin Keane from Wangaratta said rain, wherever it fell, was exactly what the market needed to gain a more positive footing.

Mr Keane, who is one of the agents running a cattle sale in Wodonga this week, said he was anticipating the rain in northern NSW and Queensland would buoy bidding.

“We would expect that some cattle out of the sale offering of 2000 or more will head north,” Mr Keane said.