THE BETTER money on offer for lighter feeder cattle appears to have enticed many producers to wean, sell and take the opportunity to rest country.
That trend has been most prominent in northern NSW and southern Queensland where the late start to the oats grazing season has meant few cattle would get to the heavier weights on time anyway.
“It has been a good opportunity but it does require having to replace on a dearer market,” Northern NSW beef consultant Bill Hoffman said.
“At the moment, most who have taken the light cattle money seem to be sitting on the few cattle they did buy in autumn and thinking they’ll make do.”
With economic analysis indicating that buying in on the current market presents very skinny profit margin potential, producers will be more likely to risk being understocked if the season does go as well as forecast.
“There is no point using feed if you don’t make money out of it,” Mr Hoffman said.
“Everybody is crystal ball gazing in relation to where the market will plateau.
“If you’re in business and rolling with it at a similar market, the current prices of restocker cattle may not be as scary but certainly there is a degree of hesitancy evident.”
Northern NSW Brangus breeders Trevor and Colleen Jorgensen, “Belview” at Delungra, sowed oats dry into May, compared to the traditional early March sowing.
“Like many people around here, we had cattle going onto oats in July instead of May,” Mr Jorgensen said.
“As a result the feeder steers we’d normally market at the end of October and into November will be much lighter.”
The Jorgensens have opted to sell a small number lighter to take advantage of the good prices on offer but take the majority through summer.
“We’re taking the approach that weight, rather than rate, is more important,” Mr Jorgensen said.
“The main issue with that will be holding onto steers into January means they will be competing against cows with this year’s calves at foot for summer feed.”
Further south, the producer reaction had been mixed, said Forbes beef consultant Jeff House.
“There are certainly some big differences between lighter cattle and traditional feeder weights but overall, prices are good anyway,” he said.
“Often people look at dollars per head rather than cents per kilogram in the feeder market.
“So while some are opting to take the money, many who have good feed are growing cattle out.”
Mr House reiterated the crystall ball scenario, saying in his 20 years in the industry he had not encountered such an extreme situation.
The sell-off of lighter cattle pointed to very tight times down the track for feedlots, however cattle seemed to be ‘coming out of places we never knew about’, he said.
“They’re not in abundance of course but they are still coming,” he said.
“And the improved season augurs well for a good joining and good reproductive rates.
“The immediate decisions for producers are very challenging.
“Do you keep heifers and try to build numbers, knowing it is three years before any income from that heifer comes.
“Or do you jump at the extra money while it’s there.”
