Beef price boom continues in Australia

By Boyd Champness

THE Australian beef industry is in the middle of a price boom that hasnt been seen since the early 1990s.

Markets across Victoria, southern New South Wales and Tasmania all reported improved prices in recent weeks as buyers fight for limited supplies of cattle.

Last week, young trade steers jumped 10-15A¢/kg in southern Victorian prime sales to net farmers returns of up to A$600 (£243 or US$390) for 380kg (840lb) beasts.

And in NSW, bidding for weaner calves broke new heights to reach the equivalent of 200A¢/kg (81p/kg or 59US¢/lb) live.

The high saleyard prices are also reflected in Meat and Livestock Australias national indicators, which show improved prices for all categories compared with last year.

Vealers at 200-280kg liveweight have been making 126A¢/kg compared with 105A¢/kg for the same time last year.

Domestic cattle between 330-400kg are currently worth 133A¢/kg compared with 105A¢/kg this time last year, while cows are making 93A¢/kg compared with 80A¢/kg.

Korean steers and Japan Ox are both at 121A¢/kg, compared with 104A¢/kg and 103A¢/kg respectively last year.

And in further revelations bound to buoy farmers hopes, the MLA believes Australia is well positioned to tackle its export competitors this year.

MLA head of market intelligence Dr Peter Barnard said world production was falling, demand in Europe was picking up after the mad cow disease scare and demand in Asia was also improving.

Speaking to The Weekly Times, Mr Barnard said the US herd had passed the peak of its “cattle cycle” in 1996 and had dropped about 5% since.

Production was believed to have peaked last year and was expected to fall 4-5% over the coming year.

In New Zealand, there has been a significant swing from beef to dairying with beef production expected to have slumped 13% between 1996 and 2000.

In Europe, beef production was recovering after the 1996 BSE scare. Beef stocks were low and export volumes were expected to be down, he told the paper.

Mr Barnard said the Argentina-South American market had been a real surprise packet in recent times.

After being granted foot and mouth disease-free status, Argentina was expected to have been a major competitor on the world market, however, its herd had declined since 1990 from 57 million head to about 50 million.

He said Argentina and Uruguay were even having trouble filling a 20,000-tonne annual US beef quota.

One reason he gave was that the local slaughter cattle prices in those countries were excellent compared with Australias.

Mr Barnard said the major obstacle facing Australian beef was the continual decline in beef consumption.

He said beefs share of the world meat market had slipped 5% in the seven years to 1997, and if the Australian Bureau of Agriculture and Resource Economics (ABARE) is proven correct, world chicken consumption will surpass beef by 2002.