Restocker heifer prices maintain premium for 12 weeks straight
15 February 2024
Key points:
- The restocker yearling heifer price has remained above the heavy steer price for 12 weeks in a row.
- Historically, the restocker heifer indicator is above heavy steer indicator in periods of recovery.
- The biggest driver of restocker indicators is supply and demand.
For 12 weeks in a row, excluding holiday price anomalies, the restocker yearling heifer price has remained above the heavy steer indicator price. As of Thursday 15 February, the restocker yearling heifer indicator is 304¢/kg live weight (lwt), 10¢ above the heavy steer indicator at 294¢/kg lwt. This is the first extended period of a restocker heifer premium since early 2023.
Historically, the restocker heifer indicator is above the heavy steer indicator in periods of recovery and high performance. The National Livestock Reporting Service (NLRS) restocker indicators cover saleyard transactions within specifications from producer to producer. Providing us with the assumption that the buyer will use the animal to grow out or join to their breeding herd.
In the last 10 years, 51% of weekly prices have had heifers at a premium to heavy steers, at an average of a 4¢ difference. Shortening this timeframe to five years, 64% of weekly prices were at a premium, with a price difference average of 22¢.
This five-year premium was buoyed by the nearly three-year restocking period between the early months of 2020 and the tail end of 2022. Producers were seeing good rainfall and weather outlooks for the first time in three years, leading to a huge drive to restock paddocks and rebuild herds. As we know, this pushed restocker heifer prices as high as 646¢/kg lwt, a nearly 220¢ above the heavy steer price.
The biggest driver of the restocker indicators is supply and demand. During post-drought periods or positive climatic seasons, producer confidence in property capacity increases, leading to stock retention and rebuild. This in turn pushes fewer restocker animals through sales channels where demand remains high. This market reaction was evident during the price spikes through 2020–2022.
The recent improvement to prices has been coupled with consistent week on week increases in yardings for both heifer and steer restocker indicators, proving that a shift in market confidence has lifted prices, rather a decrease in supply.
