A MAJOR cattle station in central Queensland has sold for a 50 per cent discount to what the vendor paid for it at the top of the market.
Corfield Downs, north-west of Longreach, has been sold for about $7 million after having been purchased in 2008 for $13.8 million. The station was bare of cattle each time it was sold.
The 45,000-hectare property was placed in the hands of receivers PPB Advisory by National Australia Bank alongside another station, the 31,200-hectare Strathdarr, which has also sold for a discount at about $4 million. Both properties were destocked of cattle in October last year and had been held by the Milton family.
The result has raised serious concern about the values and equity levels in Queensland cattle stations.
A source close to the transaction said there was going to be "carnage" in the market as graziers who have sold their cattle may not be able to cope with debt levels. The drought, a high Australian dollar and the aftermath of the live export ban have all led to a difficult period, particularly in central Queensland. Many graziers are worried about how the drop in value in nearby properties could effect their equity positions.
A grazier from southern Queensland, David Wells, saw a receivership sale near his property and it has made him worried about the effect on values.
"It's happening everywhere. It's scary and I don't think the banks want to talk about it either," Mr Wells said.
"When you hear about those scenarios, you have to wonder whether the banks should have been lending that sort of money," he said.
PPB Advisory's David Leigh, who was the receiver for Corfield and Strathdarr, said both properties were in the grip of drought when he was appointed.
"We immediately destocked the station to preserve what feed was on the ground so as to present the property to the market in good condition and that strategy was successful," he said. "They have sold at prices which are good in the current environment. By and large the banks will try and support their customers through the tough times but there are also a number who just can't be supported." Colliers International was marketing the property.