SENIOR government agriculture economists appear to be putting more weight in international beef trade dynamics than other analysts, forecasting a 15 per cent fall in saleyard cattle prices this year as a flow-on of red hot competition in markets like Japan and the United States.
The Australian Bureau of Agricultural and Resource Economics and Science (ABARES) has the 2017-18 weighted average saleyard price of beef cattle at 455 cents per kilogram, which is slightly lower than many in the industry expected.
That will mainly be driven by lower prices in Australian beef’s major export markets but will also reflect a lift in cattle supply courtesy of better seasonal conditions that has driven a rebuild, mostly in the south, according to ABARES.
Much industry analysis of the 2017 cattle market story pointed to restockers and grass fever domination proving a more powerful influencer than the end-point downward pressure being exerted at a global level.
As a result, estimates so far on cattle price falls this year have been more conservative than that of ABARES.
Although, at the moment the fickle nature of where the rain is arriving, particularly in Queensland, means very few in the game are willing to put their name to much regarding cattle market fluctuations.
ABARES says up until 2021, intensified competition globally and the expansion of supply, assuming an average season, will push prices down.
In four years, the average saleyard price will be 5pc below the 2018 projection.
Still, that is 12pc above the ten-year average of 389c/kg.
ABARES experts singled out competition from ramped up US beef production, which is overflowing into export markets and often directly targeting key Australian customers, as one of the main influencers in the medium term.
Despite rising volumes, export prices will decline from $7.6 billion this financial year to $7.3b by 2023.
As is the case in most of the major beef exporting nations, projections from numerous sources are pointing to a lift in Australian beef production this year.
ABARES has it at 8pc to 2.2 million tonnes carcase weight. Out to 2023, it is expected to remain around the 2.4m tonnes mark.
Shan Goodwin
Shan Goodwin steers ACM’s national coverage of the beef industry. Shan has worked as a journalist for 30 years, the majority of that with agricultural publications. She spent many years as The Land’s North Coast reporter and has visited beef properties and stations throughout the country and overseas. She treats all breeds equally. Contact 0427686187. E: s.goodwin@austcommunitymedia.com.au
Shan Goodwin steers ACM’s national coverage of the beef industry. Shan has worked as a journalist for 30 years, the majority of that with agricultural publications. She spent many years as The Land’s North Coast reporter and has visited beef properties and stations throughout the country and overseas. She treats all breeds equally. Contact 0427686187. E: s.goodwin@austcommunitymedia.com.au
