Big surge in NSW pushes beef kill back to near-record levels

Jon Condon, 22/10/2013


A near-record kill in NSW last week was one of the contributors to a sharp rise in overall Eastern States slaughter numbers for the seven days ended Friday.

Dry conditions across an increasingly large area of NSW/Qld remains a big factor, with the Eastern Young Cattle Indicator falling below 300c/kg yesterday, for the first time since early June.

The National Livestock Reporting Service logged an Eastern States kill last week of 156,222 head – the largest seen since the peak drought turnoff period in late May.

For once, it wasn’t Queensland’s contribution that was pushing the numbers to historically high levels, but those further south.

Queensland’s kill last week reached 78,185 head, a ‘comfortably’ full kill, without being extreme, but still 14pc higher than the previous week which was impacted by the Monday public holiday.

Further south in NSW, however, and the seven-day slaughter numbers were surprisingly high.

NSW accounted for 38,076 head, up 13pc on this time last year. The female component accounted for almost 43pc, continuing a trend in high female kill seen in NSW for the past six or eight weeks. The female liquidation cycle in Queensland, in contrast, is now concluded, with last week accounting for only 32pc of the slaughter, down from the mid-40s in the height of the drought-fuelled turnoff in May.  

Processor contacts put the high NSW kill last week down to three main factors:

  • The state’s normal spring seasonal cattle turnoff pattern
  • Rapidly drying conditions across large areas of the State’s north. This was reflected in some near-record yardings in NSW saleyards last week. Tamworth produced its highest yarding since 1998, with a total of 2800 head, while numbers at Dubbo continued to rise, up 35pc from the previous week, to a record 7750 head. Gunnedah and Scone also increased throughput by 19pc and 31pc, respectively. NLRS reported a lot of plainer conditioned lines yarded, showing the effects of the dry conditions. Overall cattle yardings in NSW were up 73pc week-on-week to total 28,885 head – due to the return of a number of selling centres (like Forbes, Tamworth and Wagga) after the public holiday Monday the previous week, combined with the record numbers being recorded at some centres.
  • A normal yearly phenomenon seen around mid-October where the state’s mixed cattle/grain producers tend to clear-the-decks of their cattle commitments before the grain harvest gets underway, which historically puts a spike in cattle yardings and slaughter numbers around now.

In southern states, Victoria also recorded a very strong seasonal kill last week at 27,023 head, with South Australia at 8854 head and Tasmania, 4093 head.

While northern producers would have been hoping recent forecasts indicated that they would get an early and above-average start to 2013-14, the neutral outlook has again left the cattle market with little forward information to progress with, as ample cattle numbers continued to keep a lid on cattle prices.

Providing a clear indication of the NSW supply pressure, the Eastern Young Cattle Indicator yesterday dropped below 300c/kg for the first time since early June, closing at 297c, down 4.25c on Friday, and 10.5c on the week previous.       

Adding to the drought conditions and subdued outlook, the A$ continues to edge higher this week, putting additional pressure on exporter competitiveness.

While overall shipments continue to be assisted by the high cattle throughput, the A$ has risen against all major trading partners in recent weeks – again eroding gains from favourable overseas prices in many markets. The A$ opened this morning at US96.53c, after starting September 5c lower, in the mid-91’s.

Processors say that importers are reluctant to share the burden in cost when the dollar is rising as it currently is, eating into exporter margins.

Processor grid price offers from Southeast Queensland yesterday were either unchanged or up 5c/kg from this time last week. Top of the heavy cow grid is currently offered at 300-305c/kg, with grassfed 0-2 tooth steer at 345c, and four-tooth 340c. The best grassfed MSA steer money we could find yesterday was 360c/kg, and grainfed MSA, 375c.  


MSA grading performance hit by weather

MSA-accredited processors report a marked decline in grading performance among MSA cattle recently, due to either the drought or dramatic variability in weather.

“We’re finding it very difficult to get cattle to grade for MSA at the moment,” one of the nation’s largest multi-site MSA processors told Beef Central yesterday.

“In the south, it’s being caused mostly by stressors caused by huge temperature variations. We saw minus 2 degrees last Friday morning, followed by daytime temperatures of 33 degrees the next day. Cattle are struggling to cope with the change, and it’s being reflected in grading performance.”

In Queensland, the grading problem is due more to the parched conditions and the nutritional impact on slaughter cattle being presented for grading.

“The glycogen bucket just seems to be very low in grassfed MSA cattle across Queensland at the moment,” he said.

Some consignments are seeing MSA grading levels on the low 60pc range, in areas where they would normally be well into the 90s.

“We’re just struggling with MSA supply,” the processor said. 




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