IT CAN feel as though the ‘spring’ bull selling season has already been going for a long time. With the early sales starting in late May, it may be a surprise that the season is still only about a third of the way through.

So far, our records show 95 sales have been conducted across Australia, with several more scheduled over the next few days. Across those sales, 4315 bulls have been offered and 3596 sold, for an average clearance of 83 percent.

Those numbers will climb rapidly in the coming weeks. The results to date also reflect the geography of the early spring selling calendar, which is dominated by northern NSW and, to a lesser extent, the Central West of NSW and southern Queensland.

One of the challenges when comparing sale results is the considerable variation in catalogue size. Angus has been the predominant breed sold so far, accounting for 48 sales to this point.

Of those, eight offered fewer than 20 bulls each. At the other extreme, Texas Angus near Warialda offered a record 302 bulls this year.

Click on images for a larger view

Weighted averages

That variation matters when averages are used to describe the market. A simple average gives every sale equal influence, regardless of whether it sold 14 bulls or 302. A more useful measure is the weighted average, which reflects the average price paid across every bull sold. Each sale therefore contributes in proportion to the number of bulls it moves.

The difference can be illustrated using two Angus sales from this spring. Texas Angus sold 302 bulls at an average of $13,921, while another sale sold 14 bulls at an average of $9214. Giving the two sales equal influence produces a simple average of $11,568. However weighting each result by the number of bulls sold produces an average of $13,712 across the combined 316 bulls, which more accurately represents the price paid across the two sales.

Across all spring sales, the weighted average so far this spring is $11,214, compared with a simple sale average of $9369. That $1845 difference shows that the sales moving larger numbers of bulls have generally achieved the stronger averages so far.

Overall spring clearance currently sits at 83.3pc, compared with 92.4pc across the 93 autumn sales recorded. That comparison requires some caution, however, because the seasonal, geographical and breed composition of the two selling periods differs. It does, however, suggest buyers have been more selective through the early spring market.

Despite that lower clearance, the weighted average price has held. The spring result so far of $11,214 is only $15 above the autumn weighted average of $11,199.

The difference between the two selling periods is therefore not primarily the price being paid for bulls. It is the proportion of the offering finding a buyer. Spring clearance is 9.1 percentage points below autumn, while the weighted average is virtually unchanged.

The chart above compares 93 autumn sales with 95 spring sales held to date. However, autumn is a completed selling period, while spring still has some way to go. The different breed and geographical composition of the two periods means the comparison should be read as an indication of buyer behaviour rather than as a direct like-for-like measure.

The early reading is that average prices have held in spring, but buyers have become more selective.

The scale of the offerings differs considerably. Angus has offered 2656 bulls so far, compared with 506 Herefords and 197 Simmentals.

Despite that difference, there has been little separation in their weighted average prices. Simmental has recorded $11,930, compared with $11,758 for Angus and $11,653 for Hereford, a range of $277 a head.

Strong clearances

Clearance has also been strong across all three breeds. Simmental has cleared 93.4pc so far, Angus 88.4pc and Hereford 85.4pc. Together, they account for more than 80pc of the spring bulls sold so far and have had the greatest influence on the overall spring result to this point.

The softer clearances are concentrated elsewhere. Brahman and Charolais have both cleared between 60pc and 65pc, although the results for the tropically adapted breeds should not carry too much weight at this stage. Most of the major Brahman, Santa Gertrudis, Brangus and Droughtmaster sales are still to come, and the northern selling season is only just beginning.

The Charolais result is more notable because it is the only breed with a substantial offering where the weighted average sits below the simple sale average. This indicates that the larger Charolais sales have generally recorded lower averages than the smaller offerings. Its $39,000 top price also reinforces the distinction between demand for selected bulls and depth of demand through an entire catalogue.

Agents and auctioneers continue to describe the commercial cattle market as strong, although there are clear signs it has gone ‘off the boil’ in the past six weeks. And there is little doubt that producers remain optimistic and prepared to invest. However, the early spring results suggest that confidence is being expressed selectively, rather than across the full offering.

Clearance is 9.1 percentage points below autumn, while the weighted average price is virtually unchanged. The results so far this spring indicate that producers are still prepared to pay for the bulls they want, however, that demand is not extending evenly through every catalogue.

Bull buyers concentrating their investment

The stronger weighted averages achieved by many of the larger sales are consistent with producers concentrating their investment among established seedstock programs.

These are often the programs where producers know the genetics, understand the breeding direction and have previous experience with the cattle.

The data cannot establish why an individual buyer chose one bull or breeder over another. However, the overall pattern suggests producers are directing their investment more carefully, rather than simply buying more bulls because the commercial market is strong.

The larger September and October fixtures will test whether this pattern continues as the selling season broadens across more regions and breeds. These sales will also provide a clearer picture of demand for Brahman, Droughtmaster, Santa Gertrudis, Brangus and the other tropically adapted breeds whose main selling periods are only beginning.

For now, spring does not appear to be a weaker market, so much as a more selective one.

Prices remain firm where bulls are selling, but the lower clearance shows buyers are making clearer distinctions between offerings and concentrating their investment where they have the greatest confidence.

Alastair Rayner is the Strategic Account Manager for Southern Australia with Vytelle and Principal of RaynerAg. He has over 30 years’ experience advising beef producers and graziers across Australia. Alastair can be contacted here or through his website: www.raynerag.com.au