October 9, 2006

Poor quality and demand drives prices down in Australia's cattle market
 

Beef cattle prices in Australian saleyards fell last week on soft restocker demand and as processors limited buying due to the poor quality, Meat & Livestock Australia Ltd said Friday (Oct 6). 

The benchmark Eastern Young Cattle Indicator was at AUS$3.21 (US$2.40) a kilogramme Thursday (Oct 5), 86 cents lower from a year earlier, MLA said.

This week's decline follows the previous week's 5 percent fall, the largest since early 2003, reflecting quality and stock availability.

The number of cattle offered in the country this week fell 15 percent although supplies from Victoria surged 52 percent, largely due to the deteriorating season, lower water availability for irrigation and livestock.

The overall cheaper physical market trend of recent weeks continued as the national Japan ox and US cow indicators again slipped.

Japanese demand is expected to recover in the next few months as stocks are depleted and demand peaks during the November-December period, MLA said.

In South Korea, buying was slow due to the national Thanksgiving holiday from Oct 5-7, it said.

MLA expects demand for Australian beef would further strengthen after Thanksgiving with the seasonal end of the year period and the continued US weakness in the market for the near future.