Cattle prices were forecast to fall this year due mainly to increased domestic supply and more competition in some key export markets according to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
The March Agricultural Commodities report, released today, predicted that in 2017–18 the weighted average saleyard price of beef cattle would fall by 15 per cent to average 455 cents per kilogram.
This mainly reflects lower prices in major export markets, particularly Japan and the United States where Australian beef continues to face increased competition plus increased cattle supply, following improved seasonal conditions that have driven herd rebuilding in recent years, mainly in parts of southern Australia.
ABARES predicts strong competition and an expansion in Australian cattle supply will keep downward pressure on Australian saleyard prices between 2018–19 and 2020–21 – assuming average seasonal conditions.
In 2022–23 when growth in world supplies slows, particularly in the United States, Australia can expect to see higher prices weighted average saleyard price of 434 cents per kilogram (in 2017–18 dollars), 5 per cent below the average forecast for 2017–18, but 12 per cent above the 10-year average to 2016–17 of 389 cents per kilogram.
This financial year Australian beef exports to China were forecast to increase by around 17 per cent to 122,000 tonnes. In the first half of 2017–18 Chinese beef imports were 29 per cent higher year-on-year and average import prices rose by 5 per cent.
Between 2018–19 and 2022–23 Australian beef exports to China are projected to grow strongly at 5 per cent per year to reach 158,000 tonnes.