THE latest cattle on feed numbers depict yet another record, reflective of feedlots pushing as hard as possible to accommodate the lack of paddock feed and capitalise on strong global demand for Australian grainfed beef.
However, with margins now under pressure on account of rising cattle prices and hefty feedstuff costs, the thinking is the next quarter will surely have to see some easing.
The December quarterly feedlot survey show numbers increased by 10.7 per cent to reach a new record of over 1.2m head.
National utilisation lifted 8pc to 90pc, Meat & Livestock Australia analyst Penny Graham reported.
All states recorded increased numbers on feed from the previous quarter. In line with seasonal trends, Western Australia was up 105pc, while Queensland and NSW both saw lifts of 9pc.
South Australia increased by 3,779 head or 8.9pc, while Victoria was stable.
Australian Lot Feeders Association vice president and SA representative Paul Vogt said there had been some expansion in capacity in the larger feedlots in his state and smaller operations were utilising every bit of space they had.
That was typical of the story nationwide, he said.
Mr Vogt said lotfeeders were expecting to find it difficult to source the numbers they needed going forward.
However, that would possibly not be as pronounced in SA as it was elsewhere, he said.
The value of the lotfeeding sector to the wider beef industry was very clear during 2019, he said.
Not only did feeder buyers underpin the cattle market in many instances, but lotfeeding enabled the continued delivery of high-quality beef during extreme seasonal conditions.
"We no longer see the lows we used to in the cattle market during dry times," Mr Vogt said.
Cattle on feed numbers have now been above the one million mark for eight consecutive quarters and analysts say that while there will inevitably be declines in 2020, they should remain at historically high levels.
Ms Graham reported national feedlot capacity increased 19pc in 2019 on the previous year. The longer-term increase in capacity represents a response to increased demand from key export markets for high quality grainfed beef, her February-released Lot Feeding Brief said.
Adam Cheetham, MLA's senior market analyst, said African Swine Fever reshaped the global meat trade during 2019, with volumes diverted away from traditional markets to China to mitigate protein deficiencies caused by a reduction in domestic pork production.
"Australian grainfed exports totalled 82,520 tonnes shipped weight through the December quarter, an increase of 5pc from year-ago levels," he said.
"Grainfed exports to China improved 61pc year-on-year to 23,989 tonnes swt."
MLA data shows the Queensland 100-day grainfed steer over-the-hook indicator broke records in the December quarter, climbing to a high of 609c/kg and an average of 605c.
Throughout 2019, OTH prices outperformed young feeder cattle as demand for finished product saw processor competition intensify, Ms Graham reported.
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The story All-time high for cattle on feed numbers but peak likely reached first appeared on Farm Online.