NLRS feeder indicators for Qld/Victoria – April 2023 to November 2024

A BIG price gap has emerged between feeder steers in Queensland and southern areas in Victoria – so much so that a typical northern Brahman-type feeder animal is currently worth considerably more than a choice EU-eligible Angus equivalent in more temperate parts of the country.

The emerging trend is clearly evident in this graph prepared by Elders analyst Richard Koch, showing a gap of at least 60c/kg liveweight, based on feeder weight steers sold via saleyards in Qld Vs Victoria. Note that the NLRS saleyard feeder market indicators make no distinction on breed type, with the Queensland numbers likely to include a combination of flatbacks, crossbreds and higher-content steers, while the Victorian numbers reflect mostly Angus, Herefords and British x Euro crossbreds.

The latest numbers on the graph are around 360c/kg for Queensland yards last week, versus 310c/kg in Victoria. That premium for northern feeders has not been this wide since around March this year.

Confidence + rain

The price gap has opened up considerably over the past two or three weeks, drive by two things: confidence, and rain.

“In the north, recent rain has clearly driven a lift in confidence among producers,” Mr Koch said.

“It’s been building for some time – starting earlier when live exporters started becoming more active in the Queensland market, and it has only cascaded since the impact of recent rain through November.

“It’s been (yet) another strong start to the northern wet season in many areas, and that’s now being seen in young cattle prices. A lot of those areas that were still looking dry a month or six weeks ago have now freshened up, and the outlook heading into Christmas is looking better for many in  Qieensland.”

“For many southern people, it’s still a bit the other way. Some are still short on stock water, and are deciding to cut their losses, marketing a couple of months earlier than they otherwise would.”

“It’s a combination of factors, but I don’t think it’s going to be long-term,” Mr Koch said.

“While national saleyard cattle price indicators have been reasonably stable recently, they belie some significant shifts happening across the states,” he said.

The strong start to the northern wet season that has delivered good rain to parts of NSW & Queensland has seen cattle prices start to firm across northern markets, up around 20c/kg liveweight.

“The rain has convinced some producers to hold stock back for kills early next year with the promise of extra weight, which has tightened nearby supplies. Assisting the lift in prices has been an increase in live export buying activity across Queensland as NT pastoral cattle supplies are finished and cattle on the NT floodplain are not ready.

“Exporters are racing to send cattle to Indonesia while they have valid export permits (they expire at year’s end) and so they will be on feed and ready for Ramadan at the end of March.”

It was a different story across the southern states where the poor southern wet season and the lack of follow-up rain after mid-October storms has feed reserves and dam levels dwindling.

“This has seen producers offer stock for sales 1-2 months ahead of normal which has pressured markets and seen cattle values fall by around 20c/kg,” Mr Koch said.

“Rising prices in the north and falling values in the southern states has seen prices disengage from each other over the past month.

But one good sign was that these northern rain troughs have been pushing deeper into South Australia and Victoria, which may mean the south may get more rain during summer than it did during their traditional winter wet season.

But reports suggested that there’s at least a couple of weeks of southern turnoff to come yet.

“Even though it’s raining now in some southern areas, they still have little feed – it’s a green drought, and some will keep selling for a couple of weeks, before shutting up shop for the year.”

January weaner sales prospects

StoneX Feeder Cattle Swaps manager Ripley Atkinson said if feeders kept pushing the market like they have been and it rains in December in northern NSW/southern Queensland, he would expect the south’s January weaner sales to have a fairly large Northern NSW/Queensland buyer presence, as buyers go chasing (relatively) well-priced southern weaners to do a 2025 trade on.

“If the southerners aren’t competing in these sales because of a poor season/lack of grass and confidence, the northern buyers may have the opportunity to secure big runs of cattle at reasonable prices, which will be appealing,” Mr Atkinson said.