Cattle and sheep prices ease

Prices for both cattle and sheep have struggled this week as adverse conditions dent market confidence, and slaughter numbers have remained high.

Key points

• The Eastern Young Cattle Indicator (EYCI) is back 12¢/kg carcase weight (cwt) from last week.
• Over-the-hook (OTH) lamb indicators are continuing to fall, with heavy trade lambs down by over 20¢/kg cwt across the eastern states week-on-week.
• Year-to-date sheep slaughter is up 20% or 137,000 head on 2018; lamb slaughter is firm.

The start of 2019 has proven quite inconsistent in terms of market prices – both cattle and sheep markets have been fluctuating week-to-week. Cattle in particular are up and down, with the increase last week matched by a decline over the last seven days.

Sheep have trended down more noticeably. The eastern states trade lamb saleyard indicator declined 26¢ over the last week to 621¢, while the national OTH heavy trade lamb indicator eased 22.75¢ to 652¢/kg cwt.

Sheep and lamb

Both lamb and mutton prices have eased considerably over the last six weeks. On Tuesday 12 February, the eastern states mutton indicator was 364¢, down 24¢ on last week’s levels and 31¢/kg cwt on a fortnight ago. This comes on the back of a substantial increase in sheep slaughter to start 2019.

Eastern states sheep slaughter through the first six weeks of 2019 was 817,651 head. This represents an increase of 20% year-on-year and 26% on 2017 levels. With no serious break in the season appearing imminent, many producers are continuing to cull heavily and it’s unlikely the high rate of mutton slaughter will ease in the short-term without a turnaround in conditions.

Year-to-date lamb slaughter has been relatively firm, the 2,044,429 head slaughtered down just 2% from the same period in 2018.

Cattle

The cattle market has generally eased this week. The EYCI were back 12¢/kg carcase weight (cwt) and the eastern states cow indicator eased 11¢/kg live weight (lwt). The eastern states heavy steer indicator strengthened slightly, up 3¢/kg cwt.

Eastern states adult cattle slaughter has been elevated above year-ago levels. The 713,806 head slaughtered so far in 2019 is an increase of 9% on the same period of 2018 and 17% from 2017. Queensland and Victoria have instigated the majority of the increase year-on-year, up 11% and 8% respectively.

The widespread flooding in north-west Queensland will begin to impact the cattle market in coming weeks and months as the full extent of losses and impact on supply is known. When the wet season draws to a close and the first northern musters begin in autumn, the effect on the national cattle market will become more apparent.