CATTLE prices continue to climb on the back of hot competition between grassed up restockers and feeders looking to keep pace with solid overseas demand for Australian grainfed beef.
Supply remains limited, although agents are predicting it might hold now, or even lift in the next few weeks on the back of dryer conditions in Queensland and vendors being allowed back to saleyards.
Apart from a reduced penning in Tamworth following rain, most NSW saleyards reported steady to slightly increased yardings over the past week.
The Eastern Young Cattle Indicator is at 766 cents a kilogram carcase weight, up 17c on a week ago and 278c above where it was this time last year.
Restocker competition has skyrocketed, particularly across southern states, since widespread rain began falling earlier this year and Meat & Livestock Australia market analysts report restockers were last week operating at a 38c premium to feeders for young cattle.
Although cattle on feed numbers dropped 12pc in the March quarter, feeling the pressure of heightened restocker demand and food service closures, MLA analysts said feeder buyers had continued to compete strongly, trading at an average premium of 28c to processors last week.
Cattle numbers were slightly higher last week on AuctionsPlus with Hannah Bird reporting pregnancy-tested-in-calf cow prices were up $96, averaging $1,911. Southern Queenslanders were busy, having secured 3,791 head as the highest purchasing region, followed by the north west slopes and plains of NSW.
The June quarter outlook from the Australian Bureau of Agricultural and Resource Economics and Sciences has the average saleyard price of steers and cows to increase by four per cent over the next 12 months to 556c/kg.
ABARES analyst Jenny Eather reported the AussieGRASS pasture growth model shows total standing dry matter - an indication of pasture availability - was at well above average or extremely high levels in much of south-east Australia as of the end of May.
The model is predicting above average pasture growth over winter for most of the eastern seaboard, particularly in Queensland.
Agents said producers were looking for all means to utilise feed and rebuild numbers as quickly as possible, given the strong fundamentals underpinning export demand over the next couple of years.
Rural Bank's latest beef overview talked about a 15 to 20 million tonne protein deficit in China resulting from African swine fever fueling demand for imports for some time.
The report said while tight supply would restrict beef export volumes from Australia for the rest of this year, price support would come from this protein gap, along with recovering demand as COVID-19 restrictions eased.
Domestic beef demand is also expected to start experiencing improvement with foodservice channels coming back online.
Meanwhile, United States beef production has now returned to what most analysts are calling normal.
Mecardo's Angus Brown reports the lower prices are already flowing through to Australian export beef values, but the impact is yet to be seen on the cattle market.
Mr Brown's weekly article, released today, says more concern could come from ramping up of US grainfed beef exports into key Australian markets such as Japan and Korea.