A wet lead-in to winter appears not to have translated into the bumper oats crop that might normally be associated with good planting conditions across Eastern Australia.
With the main oats planting window from late February to late May now passed, seed suppliers report that sales have not reflected significantly large plantings.
Pacific Seeds northern regional sales manager Brad Jamieson told Beef Central yesterday that plantings across Queensland and Northern NSW were not large by historic standards.
“From commercial lines of oats sold for grazing by proprietary companies I would estimate about 50,000ha would have been planted this year, which would be well back on previous years due to supply issues and seasonal conditions,” Mr Jamieson said.
That compared to larger crops in previous years across Eastern Australia of 80,000-90,000ha.
Ross York from WD Ag in Toowoomba said many producers had an abundance of feed in paddocks on which to grow stock and were therefore opting to capitalise on the good planting conditions by planting cash crops such as wheat instead.
He added that actual oats plantings could be larger than those reflected by sales from proprietary companies due to the large amount of oats that is typically traded from farmer to farmer.
Southern Queensland cattle producer Lee McNicholl, “Arklow”, Dulacca, said the sums involved in planting an oats crop to take feeder steers through to oats-finished bullocks didn’t add up in the current market.
Good quality crossbred feeder steers weighing 450kg were worth 1.85c/kg or about $832.50 in current market.
The cost of planting the oats required to get the same steers to 600kg was about $120/steer, based on an estimated oats planting cost of $60/acre and the requirement of two acres/beast to get each steer up to the 600kg weight.
On the current market a 600kg bullock will fetch around $1.70/kg, or $1020.
Effectively it would cost $120 to make the $188 per head difference between selling cattle as feeder steers or as finished bullocks. That did not take into account costs of interest or the risks of plantings not translating into a successful crop.
“People are opting to sell them as feeder steers rather than incur the cost of taking them through, particularly if they are bought cattle,” Mr McNicholl said.
“On the current market, I don’t think you can buy feeder steers and make money putting them on oats
“The price for good quality feeder cattle doesn’t allow you to buy them and put them on oats and make a reasonable profit given the current $1.85 for good feeder cattle if the market remains at $1.70 for oats-fattened cattle.
“They are still worth too much in the feedlots. Even though the feedlots are doing it tough, they still have to keep operating and buying cattle.”
Mr McNicholl said it was possible that oats plantings traditionally used to take bullocks to 600kg were now being used to grow lighter cattle to background weights.
There was likely to be better value in taking a 300kg weaner steer worth 200c/kg or $600 on oats through to 450kg, which at$1.85c/kg would be worth $832.50.
That amounts to a $232.50 margin on taking lighter cattle to feeder weights, as opposed to the $188 return on offer for taking a 450kg feeder steer through to 600kg bullock-specifications on oats.
This scenario also benefited by the fact a 300kg steer could run on one acre of oats.
“I don’t expect there will be a record turnoff of oats fattened bullocks this year unless abattoir prices improve.”
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