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Grain-fed Numbers Increase

21 February 2012

AUSTRALIA - Results from the latest Australian Lot Feeder' Association/ Meat and Livestock Australia December quarter survey showed an 11 per cent increase in grain fed cattle numbers on feed as lower feed grain prices and a slightly lower dollar helped offset continued high feeder cattle prices and ongoing difficult international trading conditions.

Australian Lot Feeders’ Association (ALFA) Vice President Warren Barnett commented that whilst numbers were up, the trading environment still remained extremely tough.

“Feeder cattle prices (nine per cent higher year on year) reflected the ongoing good seasonal conditions (and hence re-stocker demand for young cattle) with feeder steers hitting 229¢/kg lwt – the highest quarterly price since records began in 2003.

“Fortunately however, several other factors provided sufficient impetus to encourage lot feeders to increase cattle numbers over the quarter.

“The Australian dollar compared to the third quarter was down 3.6 per cent against the US Greenback and four per cent against the Yen, whilst feed grain prices declined by 9-29 per cent year on year depending on the grain type and area delivered.

“The northern abattoir demand for finished cattle following annual Christmas closures also helped drive numbers, particularly for larger vertically integrated feedlot operations.

“The diversion of live export cattle to feedlots following the suspension of the Indonesian trade additionally had an impact.

“All states experienced increases in cattle numbers except South Australia.”

Meat & Livestock Australia’s Manager for Market Information and Analysis, Tim McRae stated: “Grain fed exports to our major markets for the quarter were down with a 13 per cent year on year decline to Japan and a 11 per cent fall in Korea.

“Grainfed beef exports totalled 44,508 tonnes swt in the December quarter, a 12 per cent fall year-on-year. With many of the factors that have fuelled the record run of the $A in recent years unlikely to subside in the short term, Australian lot feeders will again be looking for a rise in global beef prices to improve returns.”

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