FEEDER cattle grids have again risen significantly as supply tightens on the back of storms passing through large parts of the Eastern Seaboard.

Packaderinga feedlot

Feedlot buyers who spoke to Beef Central this morning were quoting 400kg+ flatback feeder steers on the Darling Downs between 525-550c/kg – which is about a 20c rise on the last feeder cattle market update.

Getting a good quote for Angus steers on the Darling Downs has been hard, with little numbers traded and one big player still out of the market. Beef Central understands bids for heavy Angus feeder steers in the north have been around 600-620c/kg.

Some Northern New South Wales lotfeeders have reportedly been very active in parts of Victoria and Southern NSW looking for Angus feeder steers, buying for more than 600c/kg before they are trucked home.

There is a large spread on quotes for Angus feeder steers in the south, with buyers quoting between 580-620c/kg – a 20c rise on the past fortnight.

Angus feeder heifers are also strong, ranging between 550-560c/kg, with heavier weights being a key to that market.

Special sales show impressive results

Many have been commenting about some of the strong feeder steer prices at saleyards in recent weeks – with prices going as high 560c/kg for a flatback feeder steer.

The Kennedy Livestock and Property special weaner and feeder sale at Clermont on Friday saw a run of 800 feeder steers average about 540c/kg and top at 552c/kg. A similar result was seen at the Alice Springs Show sale. (see separate analysis on that sale here)

Some have suggested that, with the feeder market being so competitive at the moment, the support for the special sales has been about trying to secure more supply from the paddock. Filling pens has also been a priority with numbers drying up in the south and the parts of Western Qld.

This morning’s Wagga cattle sale had a 377 head reduction in the 400kg+ feeder steer category, with 277 heavy feeder steers averaging 574c/kg.

Meat & Livestock Australia’s saleyard-based feeder steer indicator also increased 12c last week to open this week at 554c/kg. The 400kg+ end of the indicator averaged 562c/kg, which was also a 12c increase.

Numbers are back up at Roma this week, with 9685 head on the draw for tomorrow’s sale.

A gap in supply

Buyers who spoke to Beef Central this morning said there was currently a gap in supply of heavy feeder steers, especially with rain in Northern NSW holding back numbers.

The channel country has also seen some good rain in recent weeks, which is usually an area that brings in large numbers of feeder cattle. There is a sense that some cattle in the channel country may have fallen out of feedlot specification and will go through as grassfed bullocks.

A similar point was made by StoneX Australian livestock manager Ripley Atkinson on The Week in Beef podcast last week about cattle further north. He said the number of grassfed bullocks in Northern Australia has grown by 507,000 head from April last year to April this year.

Some have suggested that may also be for Brahman steers, which are often discounted by feedlot buyers.

There is also a large number of lighter cattle that left Northern NSW earlier this year for backgrounding in Qld that will have to come on the market at some stage – with multiple buyers telling Beef Central this morning that they are still too light.

Concern about margins

While lotfeeders in the north are still purchasing cattle at the current prices, there is some concern about a lack of margin in the coming months.

The October forward contract for 100-day grainfed cattle is reportedly sitting about 885c/kg carcase weight and there is pressure for that to rise in November if the feeder market stays at the same level.

As the market has been rising, a lot of pens will have cattle that were purchased three weeks ago between 490-510c/kg, so the current equation might still stack up. But there is concern that a full pen of feeder steers at 540c/kg, might be harder to make work.

Some have suggested the next quarterly cattle on feed survey may even show a slight dip in numbers.