Global beef report
❝Cattle prices have come back, but despite increased volumes on the market they have stabilised in recent weeks.
— Angus Gidley-Baird
PRESSURE is building in some of the world’s major beef markets, which could affect Australian trade.
Weather conditions in the US, low protein prices in Brazil and changes to live cattle and buffalo meat trading in Asia could change the course of the global market, according to the latest Global Beef Quarterly report.
Rabobank senior animal protein analyst Angus Gidley-Baird said dry weather conditions were disrupting the US beef market, with beef cow slaughter numbers tracking 10 per cent higher for this year compared with last year.
“That means there is more domestic lean product in the US, which will soften the demand for Australia’s product,” Mr Gidley-Baird said.
While the US forecast of 5 per cent production growth for the year is still on track, he said higher feed costs could limit the carcass weight increases.
“There are a number of scenarios that could play out in the US market that could have a bearing on the way the Australian market shapes up,” Mr Gidley-Baird said.
Another factor that could affect Australia was the Brazilian market having a large supply of animal protein because of issues with pork and poultry exports.
“This has put pressure on Brazil’s domestic beef prices, so it might push more beef onto the global market, so we could have more competition in the China market,” he said.
Continuing dry conditions meant producer demand for cattle had eased and beef cattle prices were more heavily reliant on global factors.
“Cattle prices have come back, but despite increased volumes on the market they have stabilised in recent weeks,” Mr Gidley-Baird said.
Mercado market analyst Angus Brown said the market had found a base for the prime slaughter-ready cattle and those prices had stabilised, but store and young cattle were a bit more volatile because of dry weather and “no real restocker” demand.
“I think the prime market will hold up but the store market might bounce if there is rain,” Mr Brown said.
While analysts were expecting slightly higher cattle slaughter this year, Mr Brown said it was “slightly higher than first thought” because the dry weather brought more cows and young cattle onto the market.
National cattle slaughter numbers for the year to March were 1.79 million, up 6 per cent.
GLOBAL TRADE: Weather conditions in the US, low protein prices in Brazil and changes to live cattle and buffalo meat trading in Asia could change the course of the global market.