Weekly kill: Slaughter numbers ease sharply heading into EOFY

Jon Condon, 20/06/2017

EASTERN states slaughter numbers fell sharply last week, as the industry moves within sight of the end of financial year.

The National Livestock Reporting Service logged a five-state kill for the week ending Friday of 124,920 head, back almost 10,000 head or seven percent on the week before.

Numbers of direct consignment and saleyards slaughter cattle are tightening up noticeably in the final fortnight before June 30, as many producers face a tax burden due to sustained high livestock prices, motivating owners to hold cattle over until the new 2017-18 financial year.

For this reason some processors are anticipating a short flush of cattle during the first couple of weeks of July, but that will inevitably hold false-promise for what lies ahead, with now universal belief that slaughter cattle numbers will be hard to come by heading into August and September.

Contributing to the decline in processing output last week was a big drop in saleyards activity, with national yardings for the week ended June 16 falling 13,000 head or 21pc on the week prior, to around 46,700 head. Most of that was seen in NSW, where saleyard numbers fell a dramatic 43pc in a week, and Victoria, back 11pc.

Both meatworks grids and saleyards rates have shown an easing tendency this week, because processors have been working hard to gather a few cattle around them for late June kills.

A number of Southern Queensland processor quotes have eased 5c/kg off grassfed ox and 10c of cows since Friday, taking four-tooth grass ox to 535c, and heavy cows to 470c. Other sites may be 5-10c less than that, with one company withdrawing grids for kills this week and next, satisfied that adequate numbers are on hand. Grainfed numbers are helping fill that void.

A large northern NSW export processor has offers for kills this current week of 510c/kg on four-tooth heavy steer, 465c/kg on heavy cows, and MSA 0-2 tooth steer 545c.

Some interesting comparisons were seen this week in forward pricing of 100-day grainfed cattle, in A$ terms, between the US and Australia.

Cattle futures are in decline in the US again, and pricing for June currently sees slaughter cattle in the US at $102 a head cheaper than Australia, before blowing-out to a $221 differential in forward pricing in October.

While Queensland’s kill this week was more or less unchanged at 69,800 head, all southern states showed substantial declines. NSW was back 14pc to 26,970 head; Victoria fell 13c to 17,540 head; South Australia dropped 19pc to 6840; and Tasmania slumped 20pc to 3870 head.




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