Cattle prices expected to head downhill but not fall off the cliff

Clare Adcock
By Clare Adcock
Updated May 18 2022 - 12:43am, first published May 12 2022 - 9:00pm
Rabobank Senior Analyst in Animal Proteins Angus Gidley-Baird addressing the crowd at the Taroom show. Photos: Clare Adcock

It's been the talk of the saleyards around the state for the last 12 months: how long will these record prices last?

Rabobank Senior Analyst in Animal Proteins Angus Gidley-Baird informed beef producers at the Taroom show that they can expect to see a decline in cattle prices, but not the dramatic crash that many have been fearing.

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Mr Gidley-Baird said that although prices will likely take on a downward trend, they will still be very solid in comparison to those in previous years.

"I'm suggesting prices will ease around 20 to 25 per cent from the high point at the beginning of this year to the end of this year, as a steady fall throughout the year," he said to the crowd.

"But it's actually only taking us back to the prices that we saw at the beginning of 2021, and when you look at that in a historical context, that's higher than what we've seen in the last five years.

"So it sounds dramatic, but really it's still a very, very high price, and I'd argue probably a very profitable price as well.

"We're probably moving towards something that's a little bit more realistic.

"I think that's still a very positive outlook from an Australian beef point of view."

Mr Gidley-Baird explained that the recent demand for cattle was at an unprecedented high, forcing prices up and causing buyers to take whatever cattle they could lay their hands on, however he said that we can expect to see less of that urgency as the year continues.

"All through last year the urgency has seen producers with grass looking to source cattle from wherever they can, whatever they look like just because they've got grass and they need to find cattle," he told the audience.

"That's going to start dissipating out of the market because producers are going to become a little bit more discerning.

"They're going to say, well, I've got my cattle now I don't need to go and chase as many anymore. I might keep some of what I've got and I'll build my own stocks, so there won't be that same urgency in the market.

"As a result, we'll just see prices drift. They'll still be keen to buy cattle, but they'll just be a little bit more cautious about what they're buying and how much they're paying for it.

"We've still got very low cattle numbers, but we're slowly rebuilding them so we just haven't got the same urgency that we had through last year, and as a result, I think prices are going to ease across a range of Queensland saleyards."

Producers told not to panic, cattle prices not expected to crash anytime soon

Nutrien Roma livestock agent Rod Turner also doesn't expect prices to drop off anytime soon, saying that recent rainfall across the state will likely be enough to retain solid market prices.

"The cattle market has been driven by a world shortage of protein and I can't see that that's going to change," he said.

"We've had a great break across most of Queensland and Southern Australia with the rain this season and the meat job is very strong, so I can only see that prices are going to maintain at this point in time.

"The market looks pretty solid where it is now and I don't think it's going to get any dearer.

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"But it's a bit different with breeding cattle, breeding cows may possibly get dearer because everyone is looking to get into the cattle job now."

Speaking on the current situation around Roma and the south west area, Mr Turner said producers are experiencing good conditions and are hopeful that the good season will continue heading into winter.

"Most of the properties around here have had close to two inches now. It's been raining here since last Thursday off and on, all good soaking rain so the crops are all looking good," he said.

"Plus the oats here which were 4 to 6 inches high last week are all up over a foot high now. In another two or three weeks time there will be a lot of people looking to buy cattle to put on their oats.

"It's all very, very solid at the moment.

"No doubt there will be cattle to come from the drier parts, from Alice Springs right through to the top of the Territory, so there will be some cattle flowing out of that country.

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"They'll mostly be Brahmans and that's probably what people are going to have to buy, to either fatten them or turn them into heavy feeders in the near future, with all of this feed that we've got because it's been really good for nearly three seasons now."

There was also a general consensus in the Wide Bay area during weaner sales last week, with agents saying that although prices are likely to dip in the near future, they will hopefully reach a point that is sustainable, while still profitable for producers.

Clare Adcock

Clare Adcock

Roma Journalist - Queensland Country Life

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