WESTERN Australian cattle producers are smiling all the way to the bank with prices hitting record highs in recent months.
The industry has seen large rises in price across various categories before, but this period is unique in that all categories are booming.
These record prices have been years in the making and no doubt one of the biggest contributing factors to the spike in prices is declining cattle numbers as producers have left the industry due to low returns.
Demand from live exporters and boxed beef export markets has also added to the price rush.
The biggest jump in prices has been in the slaughter types with cows up close to 100c/kg liveweight and bulls up by a similar amount compared to last year.
At the Muchea Livestock Centre this week cow beef was quoted at 240c/kg (liveweight), which is up 85c/kg or 55 per cent on last year and mediumweight and heavyweight bulls sold at 220-
245c/kg compared to 110-175c/kg last year.
In terms of younger cattle these prices are also up on previous years but haven’t risen as much as the slaughter grades.
At the Muchea Livestock Centre on Monday yearling beef was quoted at 240c/kg which was up from 200c/kg this time last year, while vealer beef was at 260c/kg which was up from 220c/kg in 2014.
WA prices are also sitting at higher levels than those in the Eastern States – something that doesn’t happen too often.
In South Australia cows are making 175c/kg (liveweight) and yearlings 212c/kg, in Victoria cows are at 200c/kg and yearlings 230c/kg, while in New South Wales prices for cows are being quoted at 190c/kg and yearlings at 240c/kg.
While the trade market is going along nicely, producers who sold weaners in various South West and Great Southern sales have also achieved good results.
At Boyanup this season, steers have topped at 320c/kg and regularly sold between 270-290c/kg and heifers have made up to 290c/kg and sold regularly between 250-270c/kg for top drafts. Last season steers ranged from 230-250c/kg and heifers 220-240c/kg.
The store market has also been strong with heavy beef steers regularly making more than $1000 and Friesian steers consistently selling above 200c/kg.
Landmark commercial cattle manager Daniel Wood said the record prices were a combination of a number of factors in regards to both supply and demand and had been 10 years in
“We are seeing cow prices up close to 100c/kg liveweight on last year, which means cows (500kg) are returning up to $500 a head more than last year,” Mr Wood said.
“Heavy bulls are making 220 to 240c/kg compared to 90c/kg two years ago.
“Probably the biggest factor driving the prices is the low numbers of cattle on offer.
“Cattle numbers have been in decline in WA for a number of years with people getting out of cattle due to the low returns and this, combined with last year’s drought in New South Wales and Queensland, has resulted in large numbers of cattle being slaughtered. The numbers just aren’t there now.
“The US herd is also at an all-time low, which is having an impact as well.
“In terms of demand all the markets are very strong.
“There is strong demand for US grinding beef, while the live export markets are strong and getting to a point where it
is becoming hard to fill orders.
“Australia’s status of producing disease free, clean beef is also driving the markets, as everyone wants clean meat.
“The low Australian dollar is another contributing factor
when it comes to the export markets.”
Elders WA livestock sales manager Tom Marron said the industry had never seen prices so high for the manufacturing type cattle (cows and bulls), as well as big pastoral bullocks.
“At Muchea this week bulls sold up to $2400 and cows up $1900, which is unheard of,” Mr Marron said.
“The slaughter cattle are really driving the market at the moment, there is a shortage of these types of cattle and this is pushing up prices.
“One of the reasons the numbers of slaughter cattle are back, is because the live export market has also been operating on
them for markets like Vietnam in the past 12 months.
“The Australian dollar dropping 10 cents is also playing a role and is being a big help to both the live export and boxed meat export markets.
“In terms of younger cattle, prices for these are also strong, but they probably haven’t jumped as much as the manufacturing types.”