LATEST beef export figures released by Department of Agriculture show tonnage at the halfway mark of the calendar year is still well ahead of the same period last year but at significant cost to the size of the national herd.
For the month of June beef exports totalled 100,050 tonnes which took the six-month progressive figure for 2019 to 569,105t.
That equates to a 6 per cent increase on 2018 and healthy associated multiplier benefits through the economy but the downside is the fact that the extra cattle that have generated this result have essentially all come from the breeder herd.
Latest ABS figures (May) confirm that the proportion of females in the kill is still running at an extraordinarily high 58pc.
That is about 7pc more than what occurred in the first half of last year and those extras coming out of an already diminished herd are the reason processors have real concerns about future supply of slaughter cattle.
But in the meantime with nothing more than hope for an early spring break, the likelihood is that the current high proportion of females will continue.
Interestingly, average carcase weight does not yet seem to be falling with progression into the harder months of the year.
Across the three months March to May when proportion of females remained locked on 58pc, average carcase weight according to ABS was unchanged at 280kg.
By comparison in May 2018 when female proportion was 53pc, average carcase weight was 290kg.
There has been some anecdotal suggestion that females coming through now are not as good as earlier in the year and if that is the case overall and female proportion remains at similarly high levels, average carcase weight can be expected to fall and that will reflect in export tonnage.
To appreciate just how important average carcase weight is to production efficiency, we need only to compare this year's May figures with last year's.
In 2018 a kill of 758,000 head resulted in export tonnage of 109,700.
This year it was 784,000 head for 105,400t.
That's 26,000 extra cattle killed for 4300t less beef exported.
Asia up, US down
NOT unexpectedly June's 100,050t export result was down by over 5000t on the month before, three fewer working days being a contributing factor.
Similarly no real surprise that most of that fall has occurred in the US market.
Steiner noted recently in their reports prepared for MLA that Australia's position in the US market was in part being assisted by the extent of New Zealand competing product being bought away from the US by China.
This helped to explain why Australia has been able to maintain improved tonnage to the US each month this year (until now) compared to last year.
This was significant as the progressive count to May put exports to the US at 12pc ahead of 2018.
But with New Zealand now at the low point of their yearly production cycle and having less product to go to China, it seems likely that China's price pull has attracted Australian product away from the US.
The June figures show a marked change in our exports to the US; 3300t down on May and 2000t down on same month last year.
It is also the first occasion that China has substantially imported more beef from Australia than the US.
China did actually overtake the US in December 2018 but only by 223t.
It went close in May with only 355t difference but June is the real milestone with China taking 2538t more than the US.
This brings China within striking distance of overtaking the US as Australia's second largest export beef market with progressive counts for this calendar year now at 118,030t and 122,942t respectively.
Meanwhile Australia has held ground in both Japan and Korea.
June's 26,624t to Japan, while still down by 2000t on 2018, was a substantial improvement on the 5000t drops that occurred year-to-year in April and May.
Korea went one better with a 1000t improvement on May and a similar gain month-to-month on 2018.
However Australia faces headwinds later in the year in both Japan and Korea with a US/Japan trade deal imminent and the certainty of once again of triggering safeguard in Korea.
Southern operators driving cow market
Drought depletion, time of year and now a bit of rain have all conspired to ignite the cow market in the south and the increased temperature hasn't taken long to spread north.
At the Victorian market of Pakenham on Monday heavy cows reached 297c liveweight and averaged 277c which puts them up around 540-550c/kg dressed weight, better than what bullocks have been making in Queensland most of this year.
Across the border at Wagga same day similar types reached 282c for a 256c average.
Further north in NSW at Tamworth there was a 22c price hike this week taking the top to 247c and the average to 243c for the best heavyweight cows on offer.
Last week's sizeable market of Dalby with a 6000 head total offering recorded a modest 4c increase which brought the heavy cow average there up to 220c.
Grid rates, which had remained relatively unchanged in southern Queensland since early April, are now on the move with 10c added to ox and 15c to cows on Monday.
Across the majors, that brings 4-tooth ox to 545-550c and heavy cow to 435-440c.
To the north in Rockhampton and Townsville, where supply is holding, rates trail counterparts in the south-east to the extent of freight differential.
In southern NSW, one major processor added 10c last Thursday taking ox to 565c and cow to 470c.
MLA's weekly report had slaughterings last week at 152,971, down 5pc on the previous week's high point for the year of 160,000.
Noticeably in Queensland, females in the past couple of weeks have dropped well below the 40,000-42,000 head weekly tally that had been running since mid-May.
