With only one full week of saleyard trading left and most plant kill sheets booked out for the remainder the year, there will be little movement in the cattle market for the rest 2017.
So how did prices and supply track in 2017 and what will next year hold?
Production up on the back of rising carcase weights
Beef production has risen in 2017, largely due to a significant lift in carcase weights.
In the first 10 months of the year, average male carcase weights were up 10kg year-on-year at a record 329kg, while females were up 7kg at 256kg.
Weights were underpinned by three consecutive quarters of over one million head of cattle on feed, and female slaughter remained in rebuild territory at around the 45% mark.
Beef production is forecast to finish this year at 2.16 million tonnes cwt, up 3% year-on-year.
Young cattle finish on a high
The Eastern Young Cattle Indicator (EYCI) enjoyed a 65.25¢ rally throughout October before stabilising in November. This was due to good falls across Queensland and northern NSW, driving strong restocker demand.
However, the strong finish to 2017 was not enough to offset the falls recorded mid-year, as dry conditions set in across most of the eastern states.
This trend was the complete opposite to 2016, when a wet winter across much of the country sparked a solid rally in the EYCI before it was confronted with another failed Queensland wet season.
For now, restockers remain in the driver’s seat. At the close of Monday’s markets, the national restocker steer indicator tracked at a 63¢/kg live weight and 51¢/kg live weight premium to its processor and feeder counterparts, respectively.
Finished cattle realign to US
Finished cattle prices have largely eased in recent weeks as seasonal plant closures loomed, kill sheets filled up and the US imported beef market softened.
While the national heavy steer and medium cow indicators remain below where they tracked this time in 2016 and 2015, finished cattle prices are still historically high – above any level prior to mid-2015.
Furthermore, Australian cattle prices appear to have realigned themselves through 2017 to the historical ratio to the US market.
https://www.mla.com.au/prices-markets/market-news/australian-cattle-finish-2017-realigned-to-us-market/