Cattle slaughter projected to hit lowest level in 36 years


Beef Central (AU)



A major reduction in slaughter volumes on the back of significant rainfall in northern Australia over summer has fuelled the prospect of the national cattle herd rebuild intensifying, according to Meat & Livestock Australia’s April quarterly update to the 2021 Cattle Industry Projections.


Historically, cattle slaughter in Australia sits between 7 and 7.9 million head during years of average rainfall. MLA’s forecasts predict that Australian cattle slaughter will not exceed 7 million head until 2023, when it will reach 7.2 million head, at which point the current rebuild will have matured (see graph).


The forecast cattle slaughter for this year of 6.4 million head is the lowest in 36 years.


Despite current cattle prices being at record highs, these prices are not expected to incentivise producers to turn cattle off in large quantities. This is partly due to the fact that the national herd, and in particular the Queensland component, is the lowest it has been in 30 years.


Eastern states’ yardings have fallen by 178,055 head, or 30pc on 2020 levels (year-to-date), with slaughter back by 30pc. These figures demonstrate the impact improved seasonal conditions have created for the processing sector – not only have slaughter numbers fallen, but in saleyards they have to compete with feedlots and restockers for a reduced pool of available cattle.


Direct consignment (OTH) prices are up across the board in 2021, highlighting the difficulty processors are having in sourcing cattle. As a result of the high prices processors are paying, their profit margins have been squeezed, which has only been exacerbated by the appreciating A$.


The need to rebuild the national herd following drought, and current and forecast growth in demand for Australian beef internationally, has intensified the rebuild, MLA’s April update says. Now, many producers are focused on the longer-term outlook of their beef operations by rebuilding herd numbers.


Herd showing early signs of recovery ...


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