Markets

Cattle indicators surge after ‘godsend’ eastern states rainfall

Jon Condon, 28/03/2014

 

Physical and indicative cattle market indicators have surged dramatically in the wake of this week’s ‘godsend’ rainfall, which has dumped good to excellent moisture across large parts of parched Eastern Australia in the past 72 hours.

The eastern states cattle indicators have rallied strongly on the back of the big shift in seasonal outlook, with saleyards numbers dropping dramatically, direct consignment numbers starting to withdraw in some areas, and the benchmark Eastern Young Cattle Indictor staging a remarkable recovery.

The EYCI closed yesterday at 321,75c/kg, a 22.75c turnaround in a week, on the back of greatly reduced cattle supply and resurgent prices due to rejuvenated restocker interest. The last time the EYCI tracked above 320c/kg was mid-December. The medium cow indicator also surged strongly, lifting 11c/kg (liveweight) in a week to 124.9c yesterday, after threatening to break through the dollar earlier.

All NLRS-reported cattle sales scheduled for today have been cancelled, either due to weather access problems, or lack of numbers through withdrawal.

Solid to heavy falls have been logged across a large expanse of the eastern states since Wednesday, with areas of northern NSW and southern Queensland typically recording rainfall of 50-100mm, and up to 200mm in isolated pockets closer to the coast. Inland NSW and Queensland, and through Victoria, measured lesser falls, more typically around 25mm-50mm.

Some areas received their highest rainfall totals in almost two years. See full seven-day registrations for centres in your state at the base of this page.

While the rain represents an exceptionally late-breaking wet, there’s still a month or so of warmer weather likely to stimulate pasture growth, and many areas dependent on surface water for stock have recharged dam levels that will provide a supply out to spring, at least.

Equally importantly, the soil moisture will spark a winter crop planting in many areas that missed out earlier, and forage cropping will again become a factor in calculations. Roughage and hay prices have skyrocketed over the past six months as the drought has worsened, and feedlots and other large end-users were starting to face the prospect of running out of roughages, in some areas.    

While the overall impact on cattle throughput will only be determined in weeks to come, this week’s deluge will undoubtedly have many producers reassessing their selling options, Meat & Livestock Australia analysts said this morning.

“Indeed, while rainfall was desperately required across many regions, so too is cash flow – so the balance between selling (lured by anticipated higher prices) and waiting for the countryside to respond will undoubtedly be a farm-by-farm decision,” MLA said.

Further rain through central NSW has only bolstered an already favourable autumn break, with many producers now reportedly scrambling to sow winter crops. Good falls have also been registered in the southern states, with another front anticipated to possibly deliver follow-up falls next week.

In other NLRS indicators followed in recent days, trade steers have been well sought-after by restockers, lifting 16c to average 354c/kg dressed, while the medium steer indicator averaged 328c/kg yesterday, up 22c on last week. Heavy steers followed the upward trend, averaging 13c higher week-on-week, at 338c/kg. Medium cows experienced the largest increase in price, up 23c, averaging 262c/kg. Feeder steer offerings were much lower at saleyards this week, which assisted prices improving 7c, averaging 179.2c/kg live.      

 

Big spread seen in markets

The rainfall across the eastern states has caused a major spread in NSW saleyard cattle prices, largely due to supplies retracting where pasture conditions are improving, and the subsequent restocker demand recovering in those areas.

The average price of EYCI-eligible cattle at the Central Tablelands Livestock Exchange (CTLX) has improved 24c/kg over the past three weeks, averaging 338c/kg this week, after rainfall of up to 200mm reported through supply areas. Wagga followed a similar trend, with the average price of EYCI eligible cattle increasing 8c/kg through March, to 323c/kg cwt this week, after 50-100mm of rain recorded in the surrounding areas. 

In contrast, cattle suitable for the EYCI at Roma store sale on Tuesday averaged 324c/kg this week, back 6c/kg from the start of March, despite rainfall of up to 75mm recorded in some areas. Gunnedah, in the North West Slopes and Plains of NSW, has seen EYCI eligible cattle remain steady, averaging 310c/kg this week, which is reflective of the ‘well below average’ rainfall received for the month, along with the decline in cattle condition.

Pakenham, in Victoria, has had very little rainfall for the month, seeing prices decline 16c/kg, averaging 328c/kg cwt this week, as feed quality is continually deteriorating with winter looming.

This week’s falls through much of Central and southern Queensland and the forecast rain for NSW and Victoria is likely to assist further price improvements over coming weeks, MLA suggested.

 

QLD cattle market summary

Saleyards numbers fell substantially in Queensland this week, falling to less than half the number seen the week before. Buyer attendance was generally good and the light rain combined with the possibility of more, encouraged extra restocker buyers into the market.

The shorter supply combined with the rain turned prices around dramatically for many categories.  Well-bred calves at Dalby increased by 50c/kg, with one consignment reaching 216.2c, with most sales at +160c/kg.  A fair supply of lightweight yearling steers returned to the paddock 16c dearer at 177c and D muscle lines at 145c/kg. Mediumweight feeders improved 2-6c, to average in the high 160s, with some to 190c.

 

NSW weekly cattle summary

Useful rainfall across most parts of the state towards the end of the week helped to reduce numbers by close to 50pc week-on-week at MLA’s NLRS reported markets. Wagga commenced the selling week and penned 25pc fewer cattle, as Forbes nearly halved its numbers. Tamworth was back 19pc week-on-week. CTLX lost 43pc as seasonal conditions improve across the tablelands, while Gunnedah penned its smallest market for some time.

Goulburn defied the lower trend to increase its offering by 23pc, even after good rainfall was recorded around the supply area. The Hunter markets trended lower, while the northern markets of Casino, Armidale and Inverell all penned small offerings, as useful rainfall was recorded throughout the region.

The smaller yardings strengthened competition, as the younger vealer steers returning to the paddock lifted on average 20c, with most sales around the 183c/kg range. The 200kg plus vealer heifers to the processors gained much the same. Yearling steers to lotfeeders gained 5c to 10c, depending on weight, as the medium weights averaged 183c, after topping at 205c/kg. Heavyweight grown steers to slaughter lifted 6c, as younger pens topped at 200c, although most sold in the 178c to 187c/kg range. Cows enjoyed stronger processor competition, as prices improved 2-10c/kg, and more in places.

 

Vic weekly cattle summary

Total cattle throughput declined by 15pc across Victoria this week. Consignments at Warrnambool halved, while Wodonga followed a similar trend to be back 33pc to yard 2450 head, while Pakenham’s offering’s reduced by 6pc. Camperdown, Ballarat and Bairnsdale’s yardings were relatively unchanged on last week.

Prices trended cheaper overall due to the reduction in supply although the well finished lines are attracting higher prices. Heavy weight C3 yearling steers lifted 6c week-on-week, averaging 188c, while the equivalent heifers topped at 195c to average 170c/kg. The 500-600kg grown steers averaged 183c, up 7c on last week, while D3 bullocks topped at 187c to finish on 175c/kg.

 

 

Click below to access BOM’s seven day rainfall totals to 9am this morning for your state:

Queensland:  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDQ60004.html

NSW:  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDN60004.html

Victoria:  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDV60004.html

Tasmania:  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDT60130.html

NT:  http://www.bom.gov.au/nt/observations/weekly_rainfall.shtml

South Australia:  http://www.bom.gov.au/products/IDS60130.shtml

Western Australia (Southern):  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDW60045.txt

Western Australia (Northern):  http://www.bom.gov.au/cgi-bin/wrap_fwo.pl?IDW60043.txt

 

 

 

 

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