The price of Australian cattle remains high, despite a seasonal price decline of 12 per cent between October and December 2016, according to Rural Bank and Rural Finance’s January 2017 Australian Cattle Update.
In spite of this decline in prices late in the year, Australian cattle producers begin 2017 in a good position thanks to an initial 2.8 per cent increase in prices.
The January 2017 report, launched by Rural Bank and Rural Finance’s specialist insights team, Ag Answers, provides producers and industry with a concise analysis of the Australian cattle sector.
Andrew Smith, General Manager Agribusiness for Rural Bank and Rural Finance, said Australian cattle producers were in high spirits after receiving above average prices throughout 2016.
“While most of the country experienced drier weather conditions towards the end of the year, prolonged dry conditions through summer and autumn could slow re-stocker demand which, as we know, was a significant driver of higher prices in 2016,” Mr Smith said.
According to the report, national slaughter rates for January to November 2016 were 19.5 per cent lower than the same period in 2015. However, the good pasture conditions experienced in winter and spring 2016 are expected to have put good weight on slaughter cattle earlier than normal, and as a result, slaughter numbers are expected to be strong in early 2017.
Overall carcass weights of adult cattle have also remained higher-than-average, partially offsetting the effect of lower slaughter rates on production, which was 17.1 per cent lower than 2015.
The new report also revealed beef export volumes have dropped further below 2015 levels with the latest November data showing a year-to-date decline of 21.2 per cent. Increased production in the US, combined with tight supplies and high prices out of Australia, has led to a 44 per cent drop in year-to-date exports to the US. The lower volumes of beef exported to the US has also meant that Japan has once again become Australia’s number one beef export market.
To view the Australian Cattle Update, visit: www.ruralbank.com.au/cattle
