THE cattle market has continued to track sideways through the flooding disasters and Ukraine war, in line with what is characteristic for March and on par with what has been forecast for this year.
The benchmark Eastern Young Cattle Indicator has not ventured much out of a 20 cents a kilogram carcase weight range with a top of 1130c since the end of January. Its gentle zig zagging has simply reflected the normal ebbs and flows of the market.
Drops in numbers on offer as producers in Queensland and northern NSW struggled to get stock to market during floods was met with equal drops in demand as processors closed to clean up water damage, resulting in little price impact.
The EYCI closed yesterday at 1129c/kg, having risen 18c in the past week, which was likely on the back of restocker enthusiasm in areas where the rain events have been favourable, not devastating.
Medium cow pricing has been the one category showing some stronger behaviour, with the indicator reaching a solid high of 386c/kg live weight at end of trade yesterday, having jumped 19c in the past week to be 106c above the year-ago level.
Thomas Elder Markets analyst Matt Dalgleish said the level market was predicted until at least April, followed by perhaps a little bit of increase through winter - maybe a fresh high - but then market pressures kicking in through the second half of the year.
"The heavy steer indicator is what we will be watching - it will be key," Mr Dalgleish said.
"It has been tracking sideways in the 440 to 450kg live weight range. When we start to see it head towards the low 400s, that will start to bring down the rest of the cattle market complex.
"Right now, its strength is continuing to provide confidence to restockers."
The possibility of northern demand for finished cattle being constrained this week on the back of ongoing flood-related Port of Brisbane logistics issues has been flagged.
This is the largest beef export shipping facility and stocks of chilled and frozen beef are building up as flow is hindered.
However, most analysts feel it will likely be a temporary glitch which won't change the direction of the market drastically.
Rabobank senior animal protein analyst Angus Gidley-Baird said the flat line of young cattle prices indicated the aggressive chase for cattle that had sent the market on a continual upward path for 18 months was finally settling.
Whether the decline starts to come during, or after, winter would depend a lot on seasonal conditions in Queensland, he said.
Global demand remained strong, keeping prices for Australia's far shorter supply high, Mr Gidley-Baird said.
"In China, we are hearing reports that food service is suffering with increased COVID outbreaks and lockdowns but retail beef prices continue to stay strong," he said.
"The big uncertainty is the potential implications of the war in Ukraine. Increased inflation and potentially slower economic activity are expected but the degree to which that rubs off on consumer willingness to spend on beef remains a question in the market."
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