Reflecting back on the past four months of cattle trading and many in the industry would now be curious about just how the New Year markets might unfold.
Of particular interest this week was the somewhat left-of-field entry into the store market of the nation’s largest export processor, JBS Swift, who was active both on the screen and at the Ballarat store market buying steers and heifers to kill and background in Tasmania.
Sources from across ditch say the Longford plant has, in recent weeks, struggled to source adequate numbers to fill its kill schedule. Its landlocked situation makes it vulnerable to a slump in homegrown supplies and along with its major competitor, Greenham at Smithton, reports suggest that both have shipped extensive numbers from the Victorian marketplace to keep their respective plants functioning.
One Tasmanian source this week said processors are hopeful that some hot and windy weather during January might dry pastures sufficiently to release a sustainable flow of numbers.
However a prominent northeast cattleman told Stock & Land the Tassie supply is very desperate.
“It’s literally a name your own price market,” he said. “We’re enjoying one of our best spring seasons, cattle are pouring on the weight, but it has come after two very poor years when large cow numbers in particular were slaughtered, and now our processors are paying the price, he said.
Looking at the bigger picture and it is interesting to note the number of cattle sold through mainland NLRS-reported markets this past four months has declined markedly.
The Victorian decline as such was 35pc lower than the same period last year and 28pc less than 2014. These numbers reflect a similar 30pc and 28pc drop respectively in yardings at a dozen NLRS-reported markets spanning the bottom half of NSW, Victoria and SA as a collective.
Looking at Victorian kill figures and the decline while as severe is reversed whereby the kill for the Sept-Dec, 2016 period was 25pc lower than 2015 and 33pc less than same period, 2014. This mirrors also the decline in the eastern states kill which are 18pc lower compared to final four months of 2015, and 28pc lower than in 2014.
Sources close to one mainland processor suggest that prices for cows must come back by at least 40-50c/kg for processors to break even. That would mean a 400c/kg cow market rather than today’s 450c/kg saleyard price but the lack of numbers suggest not, not near term and especially not while the grass remains green, restockers remain on the hunt for cattle and sellers hold the upper hand on supply.
Many thanks and best wishes for the festive season to all, particularly those who assisted me and my family through a difficult year.
