Cattle prices tipped to jump
CATTLE market prices keep reaching new highs in the north but, according to one industry leader, we haven’t seen anything yet.
Cattle Council of Australia president Howard Smith said cattlemen could be achieving $ 8/ kg liveweight for feeder steers within the next six months.
That’s right – $ 8 a kilogram. To put that figure in perspective, it’s more than three times the average prices achieved through the Charters Towers and Mareeba saleyards in recent weeks.
Speaking outside a live cattle export forum in Townsville last week, Mr Smith said feeder cattle prices in the US had reached the Australian dollar equivalent of $ 8/ kg and he believed Australian markets would reach the same giddying heights.
“We’re all getting excited about $ 2.50/ kg for a feeder steer ( in the north) and we’re getting somewhere like $ 3/ kg in the south,” he said.
“We haven’t even seeing high prices yet.
“There’s no reason why we can’t reach the kind of numbers being achieved in the US.”
Mr Smith said worldwide supply and demand dynamics for beef were pointed firmly in
started favour of Australian beef producers.
“Once supply is diminished week by week in Australia, eventually we will have to get close to parity ( with the US). I think in the next six months we will see dramatic rises.”
Mr Smith conceded a figure like $ 8/ kg represented a major paradigm shift for an industry that considers $ 3/ kg a lofty price goal.
“We’re that used to getting some of the lowest cattle prices in the world in the last 12- 18 months, it’s hard for us to comprehend,” he said.
“It’s the first time in history that demand globally is higher than the supply.”
Mr Smith said retail prices may rise somewhat. But he added that processors had been making large margins and could absorb higher costs by reducing those margins.