Rain fuelled confidence sustains cattle market
23 June 2016
Australia’s national cattle indicators all continued to climb this week, with many producers bursting with rain fuelled confidence to compete fiercely for the limited numbers on offer.
At the close of Thursday’s markets, the Eastern Young Cattle Indicator (EYCI) lifted a further 22¢ from the previous week, to the new record high of 641¢/kg cwt. Remarkably, and illustrating just how high and how quickly the indicator has lifted, it has only been one year since the EYCI broke through 500¢/kg cwt for the very first time. Furthermore, the record high in the previous price surge was 426¢/kg cwt in December 2011.
Most eastern states selling centres contributed to the rise, but in particular, EYCI eligible cattle (C2 and C3 vealer and yearling steers and heifers) at Roma, CTLX Carcoar, Gunnedah and Tamworth averaged over 670¢/kg cwt.
At the same time, the western counterpart, the Western Young Cattle Indicator (WYCI) closed markets this week at 663¢/kg cwt – just 1¢ below its record high set only three weeks ago.
At the heavier end of the spectrum, the national heavy steer indicator finished Thursday at 589¢/kg cwt, up 19¢, while the national medium cow indicator was 517¢/kg cwt, up 28¢ – each assisted greatly by the lower availability.
The widespread rainfall received again this week will only exacerbate the already tight cattle availability seen in the first half of 2016, while at the same time it will continue to boost producer confidence and optimism over potential spring feed availability.
While the market has shot to record highs very quickly, producers looking to restock should balance the rain fuelled optimism with any impeding market drivers. In particular, prices into Australia’s largest beef export destination, the US, have softened from the same time last year and this week, the US imported 90CL cow beef indicator was 599A¢/kg CIF, down 6% year-on-year.
