April EYCI begins with a bang
04 April 2017
The Eastern Young Cattle Indicator (EYCI) began April with a bang, lifting 29¢/kg cwt above week-ago levels to finish yesterday at 656¢/kg cwt.
Significant disruption to cattle numbers in the wake of ex-tropical cyclone Debbie has been part of the cause, but more so is reinvigorated restocker interest for young cattle. Widespread rainfall across large swathes of the east coast during March is now likely to carry market momentum right through April and well into May – the time of year when prices seasonally decline.
One foreseeable short term inhibitor to the EYCI’s potential comes from April containing three short trading weeks, with Easter and ANZAC Day public holidays. These, combined with some temporary plant closures after cyclonic damage, will result in subdued processor activity for the next few weeks. However, this will more than likely recover from May onwards.
Nevertheless, with the strong restocking intent expressed in the current premiums for young cattle, combined with female cattle slaughter sitting at near record lows (averaging only 42% of the total adult kill from November to January), the wheels for rebuilding the national herd are certainly in motion.
While short cattle supplies have led to April beginning with a bang, the longevity will be dictated by when the current withheld numbers eventually start flowing through the system.
MLA’s update of the 2017 Cattle Industry Projections will be released on 18 April, detailing the recent cyclonic influences on herd numbers, cattle slaughter, beef production, exports and cattle prices.
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