Processing

Weekly kill: Queensland swamped with record throughput

Jon Condon, 12/03/2014

 

The lack of any great rain relief from last month’s promising weather event was reflected in all-time record slaughter throughput for Queensland and eastern Australia last week.

Queensland recorded its highest ever seven-day kill tally for the week ended Friday, hitting 87,412 head, going about 2000 head past the previous record set back in May last year.

The figure represented a 5 percent rise on Queensland’s kill the week previous, and clearly reflected the state’s dominant influence on the nation’s beef throughput. Despite the fact that kills in all other mainland states fell last week, the big surge in Queensland meant the overall Eastern States kill itself reached a new record high, at 169,134 head.

Seasoned veteran processors were stunned that Queensland could produce a kill this large, without the additional capacity lost since closures of plants like Innisfail and Murgon in recent years.

All significant Queensland plants are working at operating capacity, with double shifts and Saturday shifts happening wherever they can be scheduled.

Thursday and Friday last week, plant livestock managers phones were ‘running hot’ Beef Central was told. Lakes Creek booked 6000 cattle forward in a single day, for example. Some Queensland plants, especially those in central parts of the state, are now booked out to the end of May.

Further evidence of the drought impact came in a huge female kill in Queensland last week. Cows and heifers numbered 41,500 head, close to 49pc of the overall kill. It’s possibly a record, but historic details are hard to establish.

Last week’s result suggests many embattled Queensland producers may have put a ring around February 28 in their calendar, and if no worthwhile rain eventuated by the end of the month, further destocking plans were activated. For many, the forecasts of rain prospects from last month’s strong low pressure system and northern cyclone were enough to hang-on just a little longer, but now that that system has passed, uneventfully, some tough decisions are now being made.

 

Yardings swell to record levels

Further evidence of this is seen in some very big physical sale yardings reported early this week. While Roma store sale yesterday was reasonably moderate at 6900 head, sales like Warwick (a record 2800 head) and Toowoomba (3700 combined, the highest in a decade) were dramatically higher. Dalby was due to sell a near-record 6800 head today.

It’s putting enormous pressure on prices, with Warwick yesterday reporting heavy grown steers and bullocks back 2-7c/kg while record cow numbers saw prices back 5c to 13c/kg. In Toowoomba, young lightweight cattle fell 10-20c/kg, while heavier steers and bullocks lost 4c to 9c/kg and cows 4-7c/kg.

Compounding the problem of very large sale yardings was the non-attendance at some physical sales by major meatworks buyers, simply because their direct consignment bookings were so large that they physically could not squeeze another saleyards beast into their kill rosters.        

Southern states kills mostly eased a little last week, due to patchy rain, together with the general tightening in supply at this time of year.

NSW was -3pc on the previous week at 38,523 head; Victoria -6pc at 29,609 head; and South Australia -5pc at 8781 head. Tasmania rose 3pc at 4804 head.

While southeast Queensland grids remained basically unchanged this week, Central Queensland grids in some cases have come back 10c/kg, due to heavy supply.

In one company’s SEQ grid example, it was offering 345c for grassfed yearling steer, 340c for four-tooth, 305c for best cow, with CQ prices 10c behind that for each. Certified Organic steer remains at 500c/kg, basically unchanged since the broader market price decline.

 

Qld cattle could start drifting south

Grids further south into NSW and Victoria are starting to show a seasonal/supply driven increase in price. A number of grid prices in the south kicked 10c last week, making the prospect of pulling cattle south, out of Queensland for slaughter more attractive.

Queensland slaughter cattle could start to head into NSW, or even Victorian plants in coming weeks, as the grid price/freight differential starts looking more compelling, and northern plants struggle to find kill space.     

Without meaning to cause any unnecessary panic, producers considering drought-forced stock sales in coming weeks should be mindful that there is a sequence of short kill weeks coming up, which will significantly impact on processors’ capacity to kill stock.

There are two consecutive short weeks either side of Easter (18-21 April), followed by another one the following week for Anzac Day (April 25). Compounding the Public Holiday issue is that major processors will not schedule Saturday shifts in the middle of a long-weekend, which all adds up to serious curtailment of eastern states killing capacity, and livestock demand, towards the end of next month.

One large processor conceded that his staff were “badly in need of a break,” having worked extremely hard over six-day killing rosters since the start of the year.  

It obvious makes sense to avoid selling cattle in the lead-up to that period, at all costs.

  

  • This week’s NLRS weekly kill report is a day later than usual, because of information access delays caused by Public holidays in some southern states.

 

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