The combination of very-large to near-record seven-day throughput in the three biggest beef producing states has pushed the Eastern States weekly kill to another all-time record.
The National Livestock Reporting Service logged a tally of 163,933 head for the seven days ended Friday across the five Eastern states – Qld, NSW, Victoria, SA and Tasmania.
That’s the highest number ever seen since this report was launched in 1998, easily surpassing the previous record of 161,930 head set back in early December.
The result graphically illustrates the plight that most of Eastern Australia is now in, season-wise, with most export and domestic abattoirs killing at their physical capacity to try to keep up with cattle supply. Weekend and double shifts can come at a cost penalty, but it is the only way processors can find to get on top of the backlog.
Last week’s kill was 16 percent higher than the week before, although the previous week was impacted by the Australia Day Monday holiday. This time last year, the Eastern States kill had reached just 108,000 head, as the slaughter season started slowly, before gradually gaining momentum as the year progressed and things got drier.
Queensland’s kill last week, at 81,480 head, wasn’t far off the state’s record, and represented the highest throughput since a very large week back in July. The figure was 18pc above the previous holiday-shorted week, and 23pc above this time last year.
The kill in NSW also soared to 39,104 head last week – the state’s fourth highest tally seen on the past 12 months – and representing a 13pc rise on year-ago figures.
In Victoria, the tally of 29,407 went close to last December’s record of slightly over 30,000 head, and was a full 23pc above kills seen this time a year ago.
South Australia and Tasmania, where the seasonal impact is much more moderate, both recorded fairly typical kills for this time of year. South Australia, at 9289 head, was +4pc on a year ago, while Tasmania (4653 head) was 1pc behind last year.
Big cow turnoff continues
Females are again making up a considerable proportion of kills in the two states where gender figures are recorded by NLRS. In Queensland last week, the figure reached 45pc, and in NSW, 44pc.
Perhaps masking that a little, however, has been the big inflows of cows out of NSW into southern Queensland plants, which started around November last year, and continues at a high rate.
It’s being caused partly because of lack of killing space in closer NSW plants, but also because direct consignment rates are making the prospect worthwhile. There appears to be little difference in cow rates between Qld and NSW currently, whereas normally at this time of year, NSW money would be at least 10c/kg in front.
One large SEQ export processor spoken to this morning said his plant was sourcing large lines of cows from as far south as Coonamble, and Tamworth.
Not surprisingly, weights in cows are light and continuing to slip, and there’s a lot more slash-pack cows than good cows coming through. A lot of cow consignment weights are averaging 220kg or less, down 30-50kg or more on what would normally been seen at this time of year.
Lighter cows cost the processor the same amount of money to fabricate as a heavy cow, but fortunately the strength of the international grinding beef meat market is helping offset that.
A pointer to the longer-term impact of the drought came from one processor spoken to by Beef Central this week, who noted the large proportion of ‘empties’ coming through in the cow kill, as cows down in condition last year never got back into calf.
That may be a portent to likely calving rates later this year, which will see the drought impact echo on into 2015.
The trend in pregnancy rates in slaughter cows is easily picked up in foetal blood extraction, for pharmaceutical use, which takes place at many larger plants.
All processors spoken to this morning said they remain under the pump in terms of keeping up with supply, despite some of the biggest early-season kills seen in history, since January.
One plant had heavy bookings now in place out to mid-March. In most cases, prices are being offered only a couple of weeks forward, because circumstances could change dramatically given the first sign of rain.
Grid prices remain unchanged
Queensland meatworks grid prices among large export sheds have been basically unchanged over the past four weeks.
Typical public grid offers for SEQ slaughter this morning were around 330-345c/kg for 0-2 tooth heavy grassfed steer, 320-340c/kg for 4-tooth, and best cows anywhere from 285c-310c/kg. Lighter cows are obviously being priced more severely. In grainfeds, we found 100-day YG steer at 365c, and 70-day MSA steer at 350c, for boning groups 1-8.
Eastern States Weekly Kill disclaimer:
Readers should be aware that there are some discrepancies between NLRS’s reported weekly kill numbers and the true commercial operations. A number of substantial processors do not provide weekly statistics for the report. In Queensland, Nolan’s at Gympie does not offer its figures, leading to a potential under-reporting of the Queensland weekly kill by about 2000 head. In Victoria, the list is longer, including MC Herd, Wagstaff, Ralphs and others. In percentage terms, Victoria is likely to be the most ‘under-reported’ state, sources tell Beef Central.
The main reason for non-reporting seems to be linked to reservations about NLRS market reporting methodology. Despite the omissions, the underlying trends seen in kill numbers nationally, and state- to-state, are considered to be reliable.