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National feedlot capacity record hits new high

12 November 2020

Key points:

  • ALFA/MLA September survey reports cattle on feed are stable, increasing by 128 head to 1,010,320 head
  • National feedlot capacity reaches a new record – 1,449,200 head
  • Feedlot utilisation remains at 70%

The results of the ALFA/MLA feedlot survey found that feedlot numbers remained steady over the September quarter, where there were 1,010,320 cattle on feed nationally, up 128 head from the June quarter.

Western Australia and New South Wales were the only two states that had increases in the number of cattle on feed, rising 2% and 12%, respectively. All other states experienced a decline in cattle on feed, with Queensland, Victoria and South Australia numbers falling 3%,18% and 7%, respectively.

Despite feedlot utilisation and numbers on feed stabilising, national feedlot capacity increased. In the September quarter the national feedlot capacity reached 1,449,200 – a new record for the industry. This high capacity has been underpinned by lower grain prices and general confidence in the sector.

Grain prices were down significantly over the September quarter, with wheat ex-Darling Downs falling 21% to $338/tonne and barley falling 18% to $298/tonne. The drivers behind the grain price fall were the Chinese ban on Australian barley exports and the expectation of an improved harvest across most of Australia’s eastern grain growing regions.

These falls in grain inputs helped offset slight increases in the National Steer Indicator, which closed 4% higher for the quarter, making cattle more expensive for feedlots to purchase.

Grainfed turnoff eased slightly in the September quarter, reducing 4% from June quarter levels to 666,822 head and accounting for 36% of all adult cattle slaughtered.

Grainfed exports also fell for the September quarter, reducing 12% to 68,590 tonnes shipped weight (swt), the lowest volume of grainfed beef exported since June 2017. Exports to Japan and China both fell, reducing 15% and 35%, respectively on June quarter figures, while exports to Korea rose by 1%.

The dramatic fall in grainfed exports to China saw Korea surpass it as the second largest destination for Australian grainfed beef on a volumetric basis and reflects the current trade environment with China.

View the latest ALFA/MLA feedlot survey results for the September 2020 quarter here.

© Meat & Livestock Australia Limited, 2020