March 17, 2011

Australia's January cattle slaughter falls to 22-year low

Australia's adult cattle slaughter for January dropped to a 22-year low, on combined holiday plant closures and record flooding and disruption across southern Queensland that prohibited cattle processing.

At 429,290 head for January, adult cattle slaughter was 11% below the same period last year, and 19%, or 98,000 head below the January average for the past five years (2006 - 2010) (Australian Bureau of Statistics). The last month to record lower throughput was in January 1989, at 411,000 head.

Although January is traditionally the lowest month for annual cattle throughput, given annual closures over the holiday period, 2011's drop in slaughter numbers was exacerbated by record rain and devastating flooding across the key beef processing region of southern Queensland. While making up around 46% of total cattle slaughter in 2010, Queensland's contribution fell to only 31% during the first month of 2011.

For January, Queensland cattle slaughter totalled 132,951 head, a fall of 19% on-year and down 27% against the five year average - its lowest monthly total since 1997. Also impacted by heavy rain and flooding, Victorian slaughter for January declined 17% on-year, while New South Wales slipped 3%.

In contrast to the other states, and reflecting a surge in demand for beef from the southern states, South Australia throughput increased 5% on-year, to 34,629 head - the largest start to a year since 1996. Tasmanian throughput for the month also increases, rising 32% on-year, to 16,243 head.

Although national slaughter for January was down 11% on-year, total beef production contracted 9%, to 121,975 tonnes cwt, as the better season was reflected in a 2% increase in average weights nationally, to 284kg/head. While Queensland weights remained relatively steady on-year, at 301kg/head average weights for January across the southern states increased significantly. New South Wales and Victoria for January increased 12.1kg/head and 10.6kg/head on-year, respectively, while South Australia jumped 8.5kg/head and Tasmania surged 21.5kg/head on last year, to averaged 285kg/head.

Interestingly, when comparing average weights to the previous monthly slaughter low of January 1989, the average adult carcases are 54kg/head heavier.

Cattle returned to the market in February, particularly in Queensland, following a run of drier weeks, with producers increasing turnoff in search of cash flow and to take advantage of the high prices on offer. Queensland cattle slaughter was a record for February, averaging just below 77,000 head.