RESTOCKERS with another bout of grass fever have launched a new run at the young cattle market, pushing the benchmark Eastern Young Cattle Indicator further into record territory.
The EYCI rebounded 30 cents a kilogram carcase weight to reach a new high of 1068c late last week and has held steady since, finishing yesterday's trade at 1065c.
Thomas Elders Markets analysts have re-labelled it the Exy; Mecardo says forget the moon, the EYCI is headed for mars and third generation Queensland stock agent Peter Hayes says there are no words left to describe both the level of prices and the extreme confidence in the market.
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Feedlot buyers are providing plenty of weight volume-wise, yesterday accounting for 52 per cent of EYCI-eligible cattle. However, it is restockers at the wheel of driving up prices. They paid an average 1171c/kg, compared to the 1016c paid by feedlots.
TEM's Matt Dalgleish said the optimistic approach to young cattle purchases made by restockers since the start of 2021 is evident in the spread of restocker steers to the EYCI. Historically, restocker steers command about a 6pc premium to the EYCI. Currently, it's at 15pc.
Mecardo's Adrian Ladaniwskyj said prices lifting despite the downward drag of higher yardings shows the strength of demand for young cattle.
MLA analysts also described that as an unusual economic phenomenon and said the pattern this year was that in weeks when restockers are active the price is rising, and in weeks where they are not, prices are falling.
And it's always rain that fuels restocker activity, agents said.
Mr Hayes, whose company Hayes & Co runs saleyards in both southern and central Queensland, said the combination of good rain in key cattle regions and the 20c jump in processor grids over the past week has been behind the latest rally.
"There is definitely a fear in everyone's mind that the market is too hot but people have green grass and want cattle and that's the dominant force," he said.
ANZ's latest commodities insights report warns ongoing high cattle prices may start to deter domestic consumers from higher-priced beef.
It says the fundamental drivers of the market are the combination of the ongoing herd rebuild with the nervousness of global beef importers over the reliability of supply from major exporters.
"With the EYCI hitting a new record almost every week, it's worth reflecting on just how much cattle prices have risen over the past two years and also how much the industry now appears to take the high levels for granted," the ANZ report said.
At the start of 2020, the EYCI sat at just 477c/kg.
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