State of the state – South Australia
15 June 2012
With much of SA receiving little rainfall for the first five months of 2012, apart from some northern regions, there have been many cattle and lamb producers having to make tough decisions on whether to buy extra hay and grain, or sell stock that are not properly finished.
However, some regions have received welcome rainfall over the past month that assisted pasture growth before some recent very cold weather. Many producers are reporting feed being short and only suitable for lambs, with most cattle still being supplementary fed.
There would be many SA lamb producers and finishers who are nervous about making a return at current market rates, after 1 and 2 score store and light lambs were purchased for $85 to $105/head late last year. A large number of lambs have been either sent or locked in to the major processors, with June, July and August forward contracts reportedly booked out in 48 hours to one processor. Some agents are of the opinion that there could be increased numbers of hard-to-sell lightweight lambs later this year, given the very tight to negative return for some finishers so far in 2012. Skin prices have also retreated quite markedly in recent months, accentuating the lower year-on-year returns.
Sheep prices have fallen as most SA and Victorian processors briefly lowered their prices under 200¢/kg cwt. This was despite saleyard numbers being lower than expected, possibly due to the earlier good prices of over $100/head encouraging heavy culling. However, over the past couple of weeks, SA prices have recovered and are now selling generally between 240¢ and 340¢/kg cwt.
Cattle prices and supplies at SA markets have been variable during the past six months, with Mt. Gambier two weeks ago having its smallest Wednesday market on record, at only 480 head. The SA LE offerings have remained around 300 to 500 head each week, with Naracoorte drawing cattle from a wide area – including the remains of the large line of cattle that came out of the Kimberley early last year. Most processors have been able to draw on large numbers of northern cattle after regions received substantial rainfall in recent years, with many stock in prime condition. However, in recent weeks heavy rainfall has limited stock movements, due to some road closures.