Northern cattle grids ease

Eastern states cattle over-the-hook (OTH) indicators moved lower for the third consecutive week  in Queensland and New South Wales, while Victoria saw lifts across most categories. Saleyard prices also eased across all categories with the largest decline seen in the heavy steer indicator, falling by 14c/kg lwt to 330c/kg lwt. Processors in the north appear comfortable with the current supply availability.

Queensland slaughter for the week ending 27 March, was up 36% on the week prior to 70,600 head. NSW cattle slaughter increased 6% to 34,000 head whilst Victoria slaughter remained steady on week ago levels at 27,600 head. The lift in slaughter provides a short-term response to domestic demand and export uncertainty, however as the year unfolds, finished cattle are anticipated to be in extremely short supply.

State by state OTH indicators for the week ending 3 April:

Queensland:

• Trade steer averaged 568c/kg cwt - down 8c/kg cwt week-on-week
• Heavy steer averaged 577c/kg cwt - down 9c/kg cwt week-on-week
• Medium cow averaged 464c/kg cwt - down 10c/kg cwt week-on-week
• 100 day grainfed steer indicator averaged 589c/kg cwt - down 7c/kg cwt week-on-week

New South Wales:

• Trade steer averaged 566c/kg cwt - down 5c/kg cwt week-on-week
• Heavy steer averaged 577c/kg cwt - down 4c/kg cwt week-on-week
• Medium cow averaged 495c/kg cwt - down 4c/kg cwt week-on-week

Victoria:

• Trade steer averaged 598c/kg cwt - up 6c/kg cwt week-on-week
• Heavy steer averaged 597c/kg cwt - up 7c/kg cwt week-on-week
• Medium cow averaged 481c/kg cwt - down 9c/kg cwt week-on-week

Looking back, in 2019 the trade steer OTH indicator followed a downward trend heading into the short processing weeks associated with Easter, before lifting again around May when supply typically drops off. In 2020, prices have tracked higher since the start of the year, with downwards pressure only being applied now in Queensland and New South Wales, due to mounting uncertainty in export markets.

Looking ahead, domestic demand will likely hold firm due to lockdowns and closures in response to covid-19. Combined with the expected tightening supply of cattle over winter and any indication of a recovery in the global economy cattle prices could be expected to remain at historically high levels.

© Meat & Livestock Australia Limited, 2020