The lift in cattle saleyard prices in the next financial year will be significant as processors chase beef to supply robust demand internationally, senior government economists are forecasting.
The Australian Bureau of Agricultural and Resource Economics and Sciences has the nominal average saleyard price rising 24 per cent to 599 cents a kilogram carcase weight in 2024/25.
It says growth in world demand for beef is expected to outstrip supply. That will push the prices Australian exporters are able to obtain up by 3pc in the next financial year.
The United States entering a rebuild phase, and thus having far less beef to sell both to its own market and overseas, will be the big driver of that but strong demand from China will also contribute.
And Australia will be in the prime position to capitalise, ABARES believes.
Interestingly - and against a backdrop of division within the beef industry over whether the herd is headed for rebuild or liquidation - ABARES says the herd size will decline ever so slightly, by around 1pc to 23.4 million head in 2024/25.
They believe the higher saleyard returns will encourage producers to cash in and turn off more numbers.
The market uptick will follow an overall sizeable dip for the financial year ending June 2024, whereby the average saleyard price is expected to finish at an average 483c/kg.
Livestock team leader in the Agricultural Forecasting and Policy Team Alistair Read said that would be 27pc down from the average for the previous financial year.
"Both El Nino and a positive Indian Ocean Dipole have led to drier seasonal conditions across parts of Australia," he said.
That led to reduced pasture availability and kept supplementary feed prices elevated.
"This has decreased farm demand for livestock, raised turn-off rates, increased livestock supply in saleyards and lowered saleyard prices compared with 2022/23," Mr Read said.
Longer term
Over the outlook to 2028/29, the real average saleyard price for cattle is expected to range between 554 and 627c/kg, according to ABARES calculations.
An assumed onset of La Nina and a negative IOD in 2025/26 is projected to lead to a small rebuilding of the national cattle herd.
The higher restocker demand and lower supply to saleyards will increase average saleyard prices further, the forecasts say.
Over the outlook period, the real average cattle saleyard price is expected to remain below its 10-year average, reflecting higher saleyard supply as projected conditions support a larger national cattle herd.
The ABARES economists also note that Australia is far from past the threat posed by exotic animal disease.
If introduced to Australia, foot and mouth and lumpy skin disease, currently on our doorstep in Indonesia, would reduce market access for Australia's exports and be extremely disruptive, they said.
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
