Strong restocker competition drives southern over-the-hook cattle indicators higher

19 January 2017

In the first report for the New Year, over-the-hook cattle indicators across major producing regions in New South Wales and Victoria lifted this week, averaging 32¢ and 28¢/kg cwt higher, respectively, from the same time last year – driven by solid buyer demand and tighter availability.

Despite below average rainfall across the eastern states of late, restocker buyers continue to operate keenly in the young cattle market. In the first week of reporting in January, the Eastern Young Cattle Indicator (EYCI) averaged over 40¢ higher year-on-year, at 639¢/kg cwt – with ample feed stocks in many regions provoking spirited bidding from restockers. As a result, this week’s direct-to-work yearling indicators in NSW and Victoria lifted notably year-on-year, with female categories also trending dearer.

This week (ending 20th January) in NSW, compared to the same time last year:

  • The trade steer indicator (240-260kg, A-C muscle)averaged 541¢ – up 33¢/kg cwt
  • The heavy steer indicator (300-400kg, A-C muscle) averaged 546¢ – up 37¢/kg cwt
  • The medium cow indicator (260-280kg, A-E muscle) averaged 446¢ – up 43¢/kg cwt

In Victoria:

  • The trade steer indicator (240-260kg, A-C muscle)averaged 553¢ – up 34¢/kg cwt
  • The heavy steer indicator (300-400kg, A-C muscle) averaged 556¢ – up 46¢/kg cwt
  • The medium cow indicator (260-280kg, A-E muscle) averaged 438¢ – up 24¢/kg cwt

In comparison, and with some grainfed categories the exception, Queensland over-the-hook indicators so far in January remain mostly unchanged to slightly easier when compared to December, as well as the same time last year – suggesting that supply remains steady in many regions at present. However, it should be noted that some northern buyers are still yet to return to the market and as a result, a more indicative trend for the months following may come to light over the coming weeks.

Furthermore, last week (ending 13th January), NSW and Victorian cattle slaughter finished 14% and 36% lower compared to the same time last year – at 30,085 head and 17,958 head, respectively – while total slaughter in Queensland lifted 13% to just shy of 38,000 head.

As was the case for most of 2016, restockers have continued to set the platform for the young cattle market so far in January, with an eagerness to replenish female stocks also pushing southern over-the-hook indicators higher. The strong restocker buyer demand in many southern markets suggests the beginning of a herd rebuilding phase, and the general expected trend is for southern Australia (NSW and Victoria in particular) to rebuild at a faster rate than the north in the longer term – assuming average seasonal conditions and branding rates.

Highlighted in the Bureau of Meteorology’s most recent three month outlook, ‘below-average’ rainfall is forecast for large parts of eastern Australia for the January to March period.

To view the latest over-the-hook reports, click here.  

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