Northern markets start 2016 on strong note

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Tight supplies and robust live export demand saw the northern cattle markets start 2016 on a very positive note, with most store and live export indicators up more than 40% year-on-year.

Remaining fairly steady throughout February, the north Queensland over-the-hook indicators trended similarly with grids in south-east Queensland, NSW and Victoria. With some northern grids lifting as much as 10¢ last week, the over-the-hook heavy steer indicator improved 7¢, averaging 516¢, while the medium cow indicator increased 6¢, averaging 448¢/kg cwt.

Across northern saleyards (Emerald, CQLX Gracemere and Charters Towers), throughput began 2016 below year-ago levels, with Charters Towers only operating on one occasion in February. With availability to buyers continuing to have an effect on prices, young cattle recorded the strongest gains. In February, the north Queensland restocker steer indicator averaged 340¢, up 118¢ on the same time last year, while the grass-fed bullock indicator averaged 282¢, up 53¢/kg lwt.

Live export prices started the year strong and have remained fairly steady over the past seven weeks. Recently, feeder steers delivered to Darwin have been receiving 370-375¢, while Townsville feeder steers are making close to 340¢/kg lwt. Driven by strong international demand and continued drought conditions, live cattle exports for 2015 increased 3% year-on-year, totalling just over 1.33 million head, with shipments to Indonesia continuing to make up the majority.

Looking ahead, northern cattle prices typically decline through autumn, as a result of increased turnoff. With the latest three month weather outlook from the Bureau of Meteorology (BOM) predicting ‘below average’ rainfall for much of northern Australia, producers may well see history repeat itself. Although the extent may not be as large as in previous years due to the drought induced smaller north Australian herd.

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