Ongoing drought increases cattle slaughter numbers

North East & Goulburn-Murray Farmer
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NUMBERS UP: Drought conditions have seen an increase in female turn-off, and a surge of almost 10 per cent on cattle slaughter numbers.

ONGOING drought conditions, combined with a surge in female turn-off, has seen Australian cattle slaughter forecasts revised upwards to 7.8 million head for 2018, nine per cent higher than the 2017 total.

The figures were released just weeks ago by Meat and Livestock Australia (MLA) as part of their annual Cattle Industry Projections mid-year update.

MLA revises forecast:

  • MLA have revised their annual cattle slaughter upward to 7.8 million head, driven by drought and increased female turn-off.
  • Beef production for 2018 forecast to increase seven per cent to 2.3 million tonnes carcase weight.
  • Pressure on cattle prices offset by strong growth in key Asian export markets.
  • Australian beef exports forecast to increase 10 per cent in 2018.

For the first five months of 2018, Australian adult cattle slaughter totalled 3.1 million head – an increase of 11 per cent, or 300,000 head, from the same period last year – although seven per cent below the five-year average.

MLA market intelligence manager, Scott Tolmie, said females have largely driven the year-on-year increase, with a 21 per cent rise in the number of cows and heifers processed, and a modest two per cent lift in male cattle slaughter.

“Female cattle slaughter in May almost reached 403,200 head – the highest monthly volume since July 2015,” Mr Tolmie said.

“Persistent dry conditions have seen the average national adult carcase weight forecast for the 2018 calendar year revised downwards, to 292kg/head.

“However, the upwards revision to slaughter more than outweighs the expected drop in carcase weights, with beef production for 2018 now forecast to increase seven per cent to 2.3 million tonnes carcase weight (cwt).”

Mr Tolmie said while slaughter levels are expected to remain elevated and a modest contraction in the national herd is forecast, the inundation of supply, and subsequent price reaction which the industry experienced in 2013-2015 is not anticipated to repeat itself.

“The weight of supply placed some pressure on prices throughout autumn, particularly for young cattle,” he said.

“However, falls could have been much more pronounced if not for strong growth in some key Asian export markets.

“Demand in these markets has held firm in the face of increased product coming from both Australia and the United States.

“The flow-on for producers domestically has been continued price-support for finished cattle, cows and feeder suitable cattle.

“Australian beef exports are up 13 per cent for the year-to-date (January to June) with key markets, such as Japan, Korea and China, recording double digit growth.”

Australian beef exports are now forecast to increase 10 per cent in 2018, to 1.11 million tonnes shipped weight (swt).

Mr Tolmie said seasonal conditions during spring would obviously play a critical role in how the cattle market tracks, with any improvement to pasture conditions likely to see demand for young cattle and females increase.

Live cattle exports have also increased over the past six months, lifting 23 per cent year-on-year to 487,000 head, led by increased throughput out of Darwin.

MLA provides a range of market information services including daily red meat market news updates, regional saleyard reports, live export information and price indicators.

To read more or to subscribe to regular market information, visit the Prices and Markets section of MLA’s website.

More farming news and stories can be read in the August, 2018 print edition of North East & Goulburn-Murray Farmer or click here to access digital editions.