January 24, 2005
Australian body warns of easing cattle market
Australia's biggest cattle processor have warned of market prices easing off this week from current high prices.
AMH, Australia Meat Holdings, which owns four feedlots and four meatworks in Queensland and New South Wales, has delayed re-opening its biggest plant, Dinmore, until today.
Joint chief executive John Keir was quoted as saying, "I think the cattle prices have just got significantly higher than where the selling market indicates they should be, and this has been compounded in the last two months as our dollar escalated in the latter half of 2004.
"I would like it to come back a little - not necessarily a lot - and I think we've seen a correction in the last four of five days and I think that will be ongoing for a few days of this week."
One of the country's main livestock exporters is also tipping a correction in the market.
John Rich, consultant to AustAsia, says more overseas competition and a strong Australian dollar will wind prices back over the next three years.
"There's no such thing as a never-ending bull market.
"We believe that there's a correction coming, and that will come from a combination of South America and maybe other Asian countries such as India, producing beef; but there will be a correction."
One thing industry watchers know for sure ¨C demand and supply changes will take place and the short term price gains cannot be sustained for long.
