Cattle supply ramps up; what that is doing to the market

However, agents and analysts feel the declines are not excessive and are describing the market as stable, particularly in big cattle-growing regions in the north where there is now a very good body of feed.

One emerging trend agents have mentioned is a move towards selling females in order to shift back into trading steers because the margin in backgrounding is so appealing right now.

Per-kilogram rates for buying in are on par with the sell price, meaning all the kilograms gained is profit and given the feed about, that's an attractive proposition for even the big breeding regions like the Northern Rivers of NSW.

Northern NSW agent Bruce Birch, Birch Rural at Tenterfield, said while there were a few holes west of the range where the first frosts had done some damage, by and large the season had been very good to most producers.

"There are a few issues trying to manage around the wet weather and we're now hearing some people are looking for agistment to get cattle off wet ground," he said.

However, the market seemed to have found some welcome stability, he said.

"The variances from one sale to the next were much bigger than what they needed to be and that was throwing people but that seems to have disappeared now," Mr Birch said.

"There has been the odd instance over the past fortnight of heavy discounting on smaller lines and lighter cattle but the bigger lines are definitely making similar rates."

The story of good quality paying was the same in the south, Victorian agent Matt Nelson, Charles Stewart at Colac, reported.

Conditions had turned very dry across a big area of Victoria, with demand for hay very high north of Colac, he said.

"Cattle with weight and quality are still selling well but people don't want to take on light cattle to feed over winter, so that end of the market has dropped away," Mr Nelson said.

StoneX analyst Ripley Atkinson said it was expected that dynamic would continue to play out as ongoing higher supply afforded buyers the luxury of choice.

"This price divergence demonstrates the importance of ensuring cattle are well-finished and fit for sale," he said.

"Secondary quality cattle will only come under continued pricing pressure from here."

There is a forecast for small amounts of rain across southern parts over the next week which, if it eventuates, may put the brakes on supply to some degree, agents said.

In Queensland, prices for restocker cattle have held up well, a theme likely to continue into winter with good oats crops rolling, Mr Atkinson said.

The outlook from Queensland producers was more bullish due to that state being a year behind in terms of rebuild, he said.

Meat & Livestock Australia analyst Tim Jackson reported the National Young Cattle Indicator lifted week-on-week, with the indicator strongest in Queensland.