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Cattle and lamb market peak - 5/02/2010
After solid gains over January, cattle values appear to have stabilised for now, awaiting a lift in underlying demand for beef overseas.
This week, pent-up supply in NSW and Victoria following good feed over summer and last week’s Public Holiday pressured markets. This was effectively offset by the impact of excellent rains in Queensland and parts of NSW, and a fall in the A$, causing most indicator prices to remain close to last week’s rates.
Both the improved pasture and crop prospects and A$ fall, if sustained, are positives for the potential quality and price of cattle in coming months. However, a substantial market recovery still requires a lift in demand from either Japan or the US. Prices from both markets have improved since the low point late last year, but this mainly reflects the low supplies from Australia – exports to the US market in January were the lowest since January 1997.
Sheepmeat prices were also mixed this week, with a doubling in lamb yardings, led by numbers out of Victoria and SA, placing a cap on prices at record levels (for January). Demand remains robust from the local market, assisted by the Australia Day promotions, the Middle East and the US (as the trade gears up for the peak Easter demand).
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Rain stalls cattle markets
QUEENSLAND cattle producers welcomed Olga with open arms this week as the low pressure system brought much needed follow-up rain and stronger prices in store and prime markets.
Sales in Roma, Emerald and Gracemere were cancelled this week following the rain and meatworks were forced to increase over-the-hooks prices to draw out supply.
Meat and Livestock Australia's NLRS quoted processor rates were up between 2-15c/kg across the categories, with steers 300-420kg reaching 317c dressed.
The rain has prevented some processors from reopening, with those already open still operating on reduced kills and days. Last week's slaughter estimates from NLRS quoted the weekly Queensland kill at 40,649 head, down 29 percent from the same time last year.
RF Duncan and Co principal David Frances said the rain in the Rockhampton district had been anywhere from 20mm to 250mm.
"There are pockets that are not happy as they don't have surface water in the Jambin and Goovigen areas," Mr Frances said.
"The sales will be slow for the start of the year and build once its dries out and the cattle start improving."
The Emerald district received better falls according to Landmark Emerald livestock agent Matthew Beard.
"Graziers looking to restock now have the follow up rain and the added security of feed, Mr Beard said.
"People need a bit of time to get condition back on stock, but by April there should be plenty of prime cattle coming forward."
Mr Beard said store cattle prices had started strong, but prime rates would depend on supply and demand.
Emerald store values rose by up to 18c/kg at last Thursday's sale, with steers 320-400kg reaching 184c and steers 220-320kg making 198c and weaners to 200c.
At Moreton on Monday Euro cross grainfed ox account, Dennis and Michelle Heck, Glamorganvale, sold for 195.6c weighing 593kg to return $1159. Good grade cows reached 155.6c weighing 660kg to return $1027.
At Warwick on Tuesday RJC Munro, Warwick sold Angus yearling heifers for 210.2c, weighing 335kg to return $704.
Ray White Rural, Longreach livestock agent Bill Seeney said there had been plenty of general rain around the Longreach district, with the cattle to come forward in the following weeks to be in good order.
"There should be good demand for store cattle, especially cows and calves and light steers," Mr Seeney said. 5/2/2010
Lamb slaughter lower in January
MLA’s NLRS weekly lamb slaughter data for January lifted 5% on December 2009, yet fell 19% year-on-year. All states along the east coast killed fewer lambs compared with January 2009. Mutton slaughter dropped 31% year-on-year, as a result of limited sheep yardings, strong live export demand and a lower flock base.
Victorian processors slaughtered the most lambs, as numbers lifted 5% on December 2009, but fell 19% year-on-year. In NSW, monthly lamb slaughter was 347,921 head, 18% lower than January 2009 and a 2% drop on the previous month. SA lamb slaughter was 18% lower on January last year, while both Tasmania and Queensland held numbers firm year-on-year.
Contributing to the trend was the reduced yardings during January at physical markets, as producers opted to hold on after widespread rain during the Christmas period. Additionally, the extended trading breaks taken by some processors last week (due to the Australia Day public holiday falling on a Tuesday) impacted the kill figures.
January lamb supply down 12%
January lamb supply throughout the eastern states at MLA’s NLRS reported physical markets fell 12% year-on-year. The month was characterised by the combined effects of disruptions to supply and strong demand, ultimately pushing lamb values to a record for January. Despite yardings falling moderately compared with January 2009, total lamb throughput was only 7% below the five-year average.
NSW yardings slipped 17% year-on-year, as producers opted to hold on after the deluge of rain over the festive season in the North West regions. However, although this year’s yardings were low, they still exceeded lambs yarded in 2006 and 2007 by 10% and 5%, respectively.
Victorian lamb throughput lifted 3% year-on-year, despite a slow start to the year, as a fortnight of hot weather reduced supply. Numbers were able to hold firm on the five-year average, with the Hamilton market contributing the most lambs, with just over 80,000 head.
SA lamb supply decreased by the largest margin, falling 29% year-on-year. Contributing to the decline was the Australia Day public holiday last week, which prevented both the SA LE and Naracoorte lamb sales from operating.
The eastern states sheep and lamb indicators lifted early in the month, after supply was slow to resume, and firm domestic and international demand ensured strong prices were maintained. Over the hook rates followed suite, as quotes peaked at 500¢/kg cwt
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