Cattle market movers in 2019

Cattle market movers in 2019


Farm Online News
Female slaughter ratio: With an annual average female slaughter ratio for 2018 above 50%, the herd liquidation remains well entrenched.

Female slaughter ratio: With an annual average female slaughter ratio for 2018 above 50%, the herd liquidation remains well entrenched.

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In 2019, we will keeping our eye on climate, the US herd and China as key movers of the Australian cattle market writes Mecardo's Matt Dalgleish.

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THE 2018 season saw tough trading conditions for cattle farmers with a drier than average rainfall pattern that saw restocker activity curtailed and prices for store/young cattle ease. In 2019, we will keeping our eye on climate, the US herd and China as key movers of the Australian cattle market.

Global forecasts continue to suggest an El Nino is likely early in 2019, with warmer and drier conditions to persist for much of the country. A late start to the northern monsoon season appears likely, which will continue to limit northern producer’s appetite to restock.

If the 2019 season brings another failed autumn break to the south, restockers will remain on the sidelines and will continue to pressure young/store cattle prices. However, a return to more favourable conditions will see restockers encouraged back into the market.

The USA is on the verge of entering a liquidation phase for their cattle herd, which will mean additional supply will flow into the global market. Demand for beef from Asia remains strong and should be able to soak up some of the increased US production if they move into destocking phase.

However, any hiccup in Asian demand could see global beef prices come under pressure and flow through to Australian markets.

The swine flu epidemic in China will impact their local pork production and Chinese consumers will have to source pork elsewhere. Ongoing trade tensions between the USA and China will mean that the US pork industry may not be a viable solution to satisfy the gap in Chinese pork supply. This could see Chinese consumers transitioning from pork toward increased consumption of chicken, beef and mutton. An increased appetite for beef will be positive for Australian beef producers.

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