AuctionsPlus commercial cattle offerings for the third quarter of 2022 (1st July- 30th September) totaled 168,844 head - a 27.5% decline from the second quarter of 2022 and 22.7% decline from the corresponding quarter in 2021.
While widespread wet conditions have added an element of volatility to the cattle market, where upticks of supply are strongly associated with bursts of dry weather, the overall market sentiment remains robust. Clearance rates for the quarter rose by three points from the previous quarter to reach 75%, however, this was back slightly from the corresponding quarter in 2021. This is likely attributed to location and throughput fluctuations, with wider price ranges and mixed clearance rates evident across cattle stock categories.
As restocking demand remains buoyant, the reduced volume of cattle traded online amidst a setting of strong herd growth indicates both buyers and sellers are “sitting on their hands”, in anticipation of warmer and drier conditions. AuctionsPlus online commercial cattle sale throughput in the first few weeks of October has registered an increase in supply, while improved pasture growth and warmer weather in the final quarter of the year is expected to facilitate an improved flow of cattle.
Figure 1: AuctionsPlus quarterly cattle clearance rates and throughput volume from 2017- Q3 2022.
Heifers and breeding cows accounted for 58.4% of listings across the quarter, at 98,472 head, while steer listings accounted for 39.5%, at 66,676 head. Delving into throughput regions for the quarter, the top ten regions outlined in Table 1 reveals that Southern Queensland remained the top throughput region for the second consecutive quarter, with 29,685 head listed.
The NSW Northwest Slopes and Plains and Western Queensland regions took out second and third spot for listing regions, with 19,735 and 19,522 head, respectively. Clearance rates across the top three regions remained buoyant, with Southern Queensland registering a 78% clearance – up 3% from the previous quarter. The Northwest Slopes and Plains and Western Queensland both registered a 1% rise in clearance from the previous quarter - reaching 76% and 85%, respectively. A significant rise in listings saw the NSW Riverina and Southwest Slopes and Plains regions register both quarterly and year-on-year rises in cattle throughput.
Table 1: Top AuctionsPlus throughput regions for Q3 2022 and respective clearance rates.
As seasonal conditions remain broadly supportive, despite wet weather creating a raft of logistical difficulties and slowing down growth rates, rising input costs and interest rates, along with exotic disease concern dampened overall market sentiment and prices early in the quarter. While clearance rates have improved from the previous quarter, to average 75%, they are unsurprisingly back from the restocker demand driven highs in the third quarters of 2020 and 2021 which reached 86% and 90%, respectively. Recent wet weather has weighed on clearance rates across much of NSW and Victoria, as clearance rates reached 73% and 68%, respectively (Figure 2).
Figure 2: AuctionsPlus state-based cattle clearance rates for Q3 2022.
Purchasing trends for the quarter followed a similar trajectory to throughput in terms of the largest trading regions. Table 2 outlines the top ten purchasing regions for the quarter, with Southern Queensland remaining the cattle purchasing powerhouse – securing 28,462 head despite the total purchasing volume slipping 31% lower than the corresponding quarter in 2021. With ABS data revealing that Queensland accounts for 44% of Australia’s total cattle herd, it is no surprise that three of the four Queensland regions sit in the top ten throughput and purchasing rankings, despite an overall reduction in throughput volume.
Southwest Victoria and Mid & Upper Northern SA both registered year-on-year rises in throughput, which corresponded to both regions registering an increase in supply of 32% and 4%, respectively. AuctionsPlus regions which reported the largest year-on-year purchasing increases from the corresponding quarter in 2021 included Eastern/Central SA (up 101%), the Northern Territory (up 71%) and SW Victoria (up 32%).
Table 2: Top 10 purchasing regions for Q3 2022.
Looking to state based listings as a proportion of total AuctionsPlus quarterly offering (figure 3), Queensland cattle numbers rose from 31% in Q2 to 37% of total listings in Q3. NSW numbers remained steady to account for 47% of total listings. Tasmania registered a reduced proportion of listings for the quarter, back from 5% in Q2, to 3% in Q3. The recently published AuctionsPlus “On the Moove” document provides further in-depth analysis of interstate livestock movements across the quarter.
Figure 3: Breakdown of Q3 2022 AuctionsPlus cattle listings by state.