Processing

Beef kill lifts a little, but longer-term trend is down

Jon Condon, 23/07/2013

 

Eastern states beef kills lifted 1.5pc last week, but the longer-term trend continues to moderate when compared with recent all-time record highs.

The National Livestock Reporting Service logged a seven-day kill ended Friday of 149,572 head, about 2000 more than a week earlier.

Comparisons with last year show how much contrast there has been in the pattern of Eastern states kills over the past 12 months.

This week last year, the Eastern states kill was below 115,000 head, and sat for some period around 125,000 head – about 20pc below the current figure. Producers were holding cattle back to make the most, weight-wise, of an excellent season, before rates of kill started to climb in the second half of the year.

Late in the year, of course, the cycle had turned, and high kills stated to be driven by deteriorating seasonal conditions.

Last week, southern states regained some of the ground lost a week earlier in tallies, while Queensland remained basically unchanged.

While supply pressure remains reasonably high in Queensland, the normal winter deficiency in killable cattle in southern states is now in starting to show.

Queensland’s kill last week reached 80,820 head, down 1pc on a week earlier, however processors in that state report solid bookings over the next fortnight. There appears to be few, if any rosters containing weekend or overtime kills left in Queensland, as the peak of the drought-driven turnoff cycle passes.

Widespread rain in the latter stages of last week came too late to impact kills in New South Wales, with a 7pc rise recorded on a week earlier to 37,069 head. Reports suggest a major breakdown at the large Primo plant in Scone may have impacted the state’s kill performance a week earlier. One report had 52 decks of Prime cattle out of Winton camped at Roma yards while the breakdown was being rectified.

Victoria also recovered a little, rising 3pc to 23,805 head, while Tasmania was -7pc to 4267 head last week.

South Australia continued to kill at well below capacity, influenced largely by the two-week seasonal maintenance closure at the 800-head-per-day T&R Murray Bridge plant. T&R returns to work on Monday. The impact is clearly seen in last week’s SA kill at 3611 head, which while +1pc up from a week earlier, was 41pc below this time last year, when T&R was in full swing.

 

More grids down 5c/kg

Following a trend which started last week when one major Queensland processor dropped its rates 5c/kg across the board, two others have followed suit since Thursday with a similar adjustment.

That appears to be driven by a recent surge in direct consignment turnoff, perhaps sparked a little by new financial year tax implications, and also the earlier lifts seen in direct consignment slaughter rates. One large multi-site operator suggested his company’s Queensland kill roster was again heavily subscribed for the next fortnight. He expressed some surprise at how plentiful bookings had been this week.

There’s also a feeling that unless there is some rain relief soon, there might be an influx of early oats-finished cattle, that would normally not be seen until late August at earliest. Some oats crops in southern Queensland and northern NSW are apparently now showing signs of stress, and may spark some marketing activity.

The lack of rain prospects has probably also driven the big correction seen in the Queensland store market last week, which started at last Tuesday’s big Roma store sale, and continued throughout the week. Roma has responded with a much smaller yarding for today’s weekly sale, around 5000 head.

Public grid prices obtained yesterday by Beef Central for Southeast Queensland kills showed four-tooth grassfed steer at 308-315c, 0-2 tooth grassfed steer around 318-325c, and best cow 265-270c.

Grainfed cattle, particularly MSA steers, continue to hit the market in some abundance – beyond what the market can handle, one large processor said. That comes as a consequence of the big numbers placed on feed earlier in the year as the seriously dry conditions set in across Qld and NSW.

 

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