Red hot results for Wagyu on AuctionsPlus: What’s driving it?

Jon Condon, 20/07/2015

IN A niche cattle market segment which has traditionally been dominated by well-established direct-consignment selling relationships, the benefits of auction competition have been clearly evident over the past three weeks with a series of red-hot record prices being set for Wagyu F1 weaners on AuctionsPlus.

For the third week in a row, Wagyu x Angus weaners on Friday smashed commercial price records, selling to a top price of $586c/kg. A second line of 313kg weaner steers made 568c/kg liveweight or a whopping $1775 a head.

This line of 45 Wagyu F1 steers, 11-12 months weighing 313kg out of Glen Innes, made $1775 or 567.6c on Friday.

This line of 45 Wagyu F1 steers, 11-12 months weighing 313kg out of Glen Innes, made $1775 or 567.6c on Friday.

In consecutive weeks the AuctionsPlus record has been re-set from 557c to 570c and on Friday, to 586c. It is questionable whether any non-stud cattle in Australia have ever sold for higher prices via a public auction system, on a c/kg basis.

The first of the recent F1 Wagyu offerings on AuctionsPlus was on July 3, when 72 weaner steers averaging 242kg sold for an unprecedented 557c/kg liveweight, and 62 weaner heifers, 225kg made 547c/kg.

Results for F1 Wagyu weaners solid on Friday’s AuctionsPlus sale

The following week another F1 breeder looking to take advantage of a price spike, selling 55 weaner steers 223kg for 570c/kg liveweight and 55 weaner heifers 211kg for 526c/kg.

Responding to those price signals, Friday’s sale listed a much bigger offering of 264 head of Wagyu/Angus cross cattle from four vendors. Competition was fierce, with eight bidders competing for the available cattle, dominated by lotfeeders, although backgrounders and live exporters were also active. Steers sold on Friday for an average of 563c/kg liveweight, heifers averaged 509c/kg, and mixed sex lines averaged 534c.

Beef Central approached a large-scale F1 Wagyu branded beef supply chain manager to try to understand what’s going on, and why the sudden interest has emerged in AuctionsPlus as an F1 Wagyu feeder cattle marketing platform. He agreed to comment, but asked that his identity be withheld.

He described the sale results for F1’s notched up on Auctions plus this month as “unbelievable.”

“Doing the math, I don’t know how the buyers are going to get out of them, at those prices,” the contact said.

He carried out a trading budget on the steers using his own feedlot statistics for a 400-day program, and came up with a breakeven figure of $8.71/kg carcase weight to get out of jail in justifying the purchase price, given current ration prices.

He pointed out, however, that the recent record-breaking steers were only light in weight, being backgrounder types, still some way off being feedlot-ready.

“If I was offered those same cattle in the paddock as a backgrounder proposition, I might have paid 450c/kg at best for them. But nothing like the premium they made online on Friday and the weeks before,” he said.


The market drivers

Beef Central’s contact put the sudden interest in AuctionsPlus as a channel to sell F1 feeders down to two things:

  • The scarcity of ‘non-committed’ Wagyu feeder cattle in the market, and
  • The ‘unprecedented’ demand, more generally, for F1 feeder cattle carrying the right genetics over the past six months. F1 feeders (backgrounded, ready for the feedlot) bought out of the paddock had risen in price by at least 50c-60/kg liveweight, from around 360c/kg to 420c since the start of the year.

“The fact is that the Wagyu feeder cattle market is largely a ‘closed shop,’ with many feeder cattle already committed to supply chains well-forward,” our contact said.

“I’d estimate that currently, at least 70 percent of all F1s bred in Australia already have a home to go to, before they are even branded. There’s just not that many uncommitted cattle out there, available to new players.”

There was also a number of new players (F1 feeders/brand program managers) out there trying to get some numbers and market share around them, and channels like Auctions Plus was one of the only ways to source those non-committed cattle.

One of those ‘new players’ is JBS Australia, which last year entered the F1 Wagyu feeding game as part of its strategic investment in value-adding company, Andrews Meats. JBS has stated publically that it wants to expand its Wagyu cattle turnoff from 100 head/week to 250/week by the end of this year. There are several other newer (or re-building) players in the Wagyu branded beef space also looking to build numbers.

Our supply chain management contact acknowledged that using AuctionsPlus to market F1 feeders was still a very new trend. He said he saw, and bought, a first small line of Wagyu feeders on Auctions Plus a few months ago, but the trend had grown sharply in the past three or four weeks – driven by eye-catching prices.

“It’s been rare to see F1 Wagyu feeders sourced anywhere else but out of the paddock up to now,” he said.

“Any Wagyu infused cattle that have been offered in saleyards, which happens occasionally, have copped an absolute hiding, price wise, because the right sort of buyers often are not present at those sales. They often made no more than third-grade Angus prices.”

“That’s scared a lot of Wagyu cattle breeders away from any form of auction selling, as a means of finding buyers,” the contact said.

“But given what’s happened recently, I’d be very surprised if we do not now regularly see solid lines of Wagyu feeders and backgrounders on AuctionsPlus. I know that’s what I would be doing if I was breeding some – certainly while ever demand remains strong.”

AuctionsPlus’s Anna Adams on Friday said the online marketing platform was expecting to see higher Wagyu-infused stock listings and high prices continue in this emerging market segment.




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  1. Dennis Scanlon, 20/07/2015

    A great result, but not really ‘unbelievable:

    1 Take an already very valuable and sought after product being offered in a ‘closed shop’ marketing environment;

    2 Describe and verify the breeding history of the F1 animal in recognised industry language.

    3. Offer the already valuable article to a completely ‘open’ auction system

    4. While the owner still has the valuable article in his posession on his property.

    Result: Maximum competition in a secure marketplace.

    Q E D – Auctions +

    Congratulations from all who recognise a great system and the many who helped develop it from 1981 onwards.

    Dennis Scanlon.

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