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Australian cattle price hits record highs off the back of November rain

Friday November 19, 2021 - 20:38 AEDT

Widespread rain across pastoral country this month has added more fuel to Australia's red hot cattle market.

Restockers forked out big money this week for lighter animals, especially at the Queensland saleyards of Roma and Dalby, pushing the Eastern Young Cattle Indicator (EYCI) to a new record high of 1,102 cents per kilogram carcass weight (cwt).

Cattle producer Nicole James from Jericho in Queensland said the bumper prices had everyone talking.

"About two years ago [someone could] sell four decks of cows and calves and they made $40,000 for the truckload," she said.

"But now you sell a deck of steers and they make $60,000 ? it's bloody insane."

Meat and Livestock Australia said rain in key supply regions of Queensland, which had been dry ? was the trigger needed to send record prices higher.

"To put this into perspective, since the first week of January 2020, when drought and fires were raging across the eastern seaboard, the EYCI has risen meteorically by 616c/kg cwt, or 56 per cent," it said.

Cattle prices drive AACo profit

The record cattle prices have been reflected in the half-yearly financial results of Australia's biggest cattle company.

In its ASX-report, AACo said over the last six months the value of its herd increased by more than $100 million.

Its operating profit now sits at $30m ? up more than $6m compared to the same time last year.

"This is the strongest half [yearly result] the company's had since I've been involved with it," chief executive Hugh Killen said.

"Like everyone else, where the cattle prices are right now you'd like to have a few extra around ? but it's going well ? our cattle are in good health, they're very productive and we're retaining as many heifers as we can to get that breeding herd up."

How high can prices go?

Trying to predict the EYCI has been challenging this year.

Meat and Livestock Australia (MLA) asked some of the best analysts in the business to share their thoughts on what the EYCI will do between now and the end of the year.

It seems everyone agrees the EYCI will fall, but by how much?

"We've heard it wouldn't hit 900 cents, then 1,000 cents," MLA's Stephen Bignell said.

"It's really been the narrative all year, of people being surprised by the EYCI.

"I don't want to speculate [on what the EYCI will do next], but a lot will depend on rain and perhaps what we see at Roma next week."


© ABC 2021

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