Cow mar­ket track­ing well in yards

Heavy beef selling for over $2000 in yards

Central and North Burnett Times - - RURAL WEEKLY -

THE cow mar­ket has en­tered April on a high, with prices be­ing driven up by low grind­ing beef sup­plies from both Aus­tralia and New Zealand into the US.

As the ac­com­pa­ny­ing graph shows, usu­ally cow prices ease in late au­tumn as the pres­sure of sea­sonal culling puts more grind­ing beef onto the world mar­ket.

But this year lower than nor­mal fe­male cat­tle slaugh­ter in Aus­tralia and New Zealand, and the trad­ing tur­moil caused by the re­cent Brazil­ian meat scan­dal, has com­bined to push cow prices higher.

Il­lus­trat­ing this is a com­par­i­son of the av­er­age sa­le­yard price for cows in early April for the past three years.

Ac­cord­ing to data from Meat and Live­stock Aus­tralia, the na­tional price in­di­ca­tor for medium cows in the first week of April shows:

■ 2015 was 164c/kg.

■ 2016 was 218c/kg.

■ 2017 is at 231c/kg.

There have been re­ports of ex­tra heavy beef cows mak­ing over $2000 at sa­le­yards in the past week, al­though re­turns of $1400–$1600 are more com­mon for a run of

Ship­ments of beef from Aus­tralia to the US so far this year are 39% lower than the same three-month pe­riod in 2016.

good slaugh­ter fe­males.

In dol­lar per head terms, it worked out at $1500 across an av­er­age weight of 612kg, based on Na­tional Live­stock Re­port­ing Ser­vice data.

Driv­ing the cow mar­ket is low grind­ing beef sup­plies from ma­jor sup­pli­ers into the US mar­ket.

The Steiner Con­sult­ing Group, which analy­ses the US meat mar­ket, said the lat­est ex­port fig­ures from Aus­tralia and New Zealand told the tale of im­prov­ing prices for im­ported grind­ing beef.

Ship­ments of beef from Aus­tralia to the US so far this year are 39% lower than the same three-month pe­riod in 2016 (Jan­uary, Fe­bru­ary and March). Sales from New Zealand are down 10%, the lat­est re­ports sug­gest­ing ex­porters from that coun­try have been find­ing bet­ter pric­ing into Asia and are di­vert­ing meat to other des­ti­na­tions.

Ship­ments from NZ to China were trend­ing 54% higher dur­ing March.

These key fac­tors have com­bined to push grind­ing beef prices in the US higher, with val­ues lift­ing nearly ev­ery week so far this year.

It has re­sulted in im­ported grind­ing beef trad­ing at sim­i­lar price lev­els to US do­mes­tic prod­uct.

The lat­est fig­ures have prices for 90 chem­i­cal lean beef (90% red meat, 10% fat blend) at US 216–222c pound, just slightly ahead of the rate of US 214c/lb for im­ported prod­uct.

The per­for­mance of the grind­ing beef trade has a big im­pact on the over­all strength of the beef mar­ket be­cause the trim col­lected from all ex­port slaugh­ter cat­tle now just cull cows.

His­tory shows that when the cow mar­ket is hot, it helps carry other cat­tle prices higher at sa­le­yards.

In Aus­tralia heavy rain­fall from Cy­clone Deb­bie in the north should stem the flow of cows in the short-term, but weather fore­casts are still pre­dict­ing a dry end to the au­tumn in the south.

On the de­mand front the wild­card is the Brazil­ian meat scan­dal, which has prompted China to halt im­ports of beef from Brazil un­til more is known about al­le­ga­tions of bribery to in­spec­tors and sales of tainted and out-of-date meat.

Brazil was the big­gest sup­plier of beef to China dur­ing 2016, and there is spec­u­la­tion that con­tin­u­ing bans could lift prices for meat on the world stage if the Chi­nese have to find al­ter­na­tive sup­pli­ers.

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