THE unusual but welcome combination of strong cattle prices and promise of a great spring season has generated confidence that bull price levels will reach new levels when the 2016 spring bull selling season gets underway later this month.
Thousands of bulls will be offered at hundreds of on-property and multi-vendor sales from North Queensland to Tasmania as commercial beef producers search for the genetics to enhance the efficiency and profitability of their herds.
Traditionally spring bull sales have been in the northern half of the nation catering for spring-calving herds, while the autumn sales have predominantly been in the southern half of the continent servicing the autumn-calving herds.
However a growing list of spring sales have appeared in Victoria and the Riverina, most as second sales from well-established studs keen to service a trend towards spring calving in the south.
The southern autumn bull sales earlier this year were strong, but subdued somewhat by the late autumn break. However the warmer than usual May followed by the eastern states ‘big rain event’ in June has changed all that. Potential bull buyers who held off in autumn may now have to increase their bidding to secure the better prospects.
In 2015, the 8103 Angus bulls sold at 154 sales in all states averaged $6721, the highest average and the greatest number of Angus bulls ever sold in Australia in a year. The average for the 3412 Angus bulls sold this autumn was $6201, an eight percent drop on the previous year’s figure, in a period where cattle prices had strong gains.
Industry observers suggest the improved pasture conditions along with increasing, and in some instances record prices for commercial cattle will lead to Angus bull prices in the second half of the year averaging over the $7000 mark.
Illustrating the trend, Herefords had stellar sales at multi-vendor mid-season Nationals at Wodonga, Vic, in May and at Dubbo, NSW, in June. Both with over 50-year histories, Wodonga grossed $1.4 million for 141 bulls for an average $9961, while this was surpassed at Dubbo with a $912,750 gross and an $11,854 average for 77 bulls. Wodonga topped at $95,000 while Dubbo topped at $47,000. Both had clearances in the mid 80pc range.
Strong relationship between Breedplan indexes and bull prices
Herefords Australia’s recently appointed chief executive officer Dr Alex Ball said there was a strong relationship between prices and Breedplan indexes.
“Bull buyers are taking notice of performance figures – especially the grassfed and supermarket indexes – and are prepared to pay more for the top performing bulls in these categories,” he said.
“Superior growth, calving ease, 400-day weight and marbling are being sought by buyers.
“During the spring sales, we will continue to monitor what buyers are looking for and we can then plan to supply those needs,” Dr Ball said.
The Hereford BIN sire progeny trial and the black baldy discovery program are also aimed at identifying areas where Herefords can deliver positive commercial outcomes.
While Australia’s breeding herd numbers are particularly low following the past two years of drought, Dr Ball said the ‘salvage value’ for old bulls was high, because of current commercial cattle values, and some producers may have held off replacing bulls because of the tight conditions.
Dr Ball suggested that Hereford producers were benefiting from booming European Union demand.
In June 2011 the MLA’s weekly Eastern States Feeder Cattle report, short fed (100-120 DOF) steers 0-2 teeth were quoted at 200c/kg live and longfeds (200+ DOF) at 225c. A year later, in June 2013 EU steers were at 240c and longfeds, 235c.
Move forward 12 months to June 2014 and EU steers were still being quoted at a small premium over longfeds, 310c to 305c.
Last week (July 8) the EU average for shortfed steers 380-500kg was 368c while the longfeds at 300-420kg was 360c.
This represents a 12pc increase in EU prices in the past 12 months and an 18pc increase in the past 24 months.
Perhaps seedstock producers of all breeds should be advising their bull buying clients there is money to be made from cattle of all categories and even more for those from EU accredited properties.
- Next week’s Genetics Central report: The world’s largest multi-vendor bull sale is right here in Australia.