Australia’s beef industry is tracking toward one of its biggest years on record, with slaughter, exports and grainfed turnoff all forecast to reach historic highs in 2025, according to the latest market outlook from StoneX.
Australian Cattle and Beef Market Outlook 2025 H2 contains some bold calls. StoneX Australian Livestock and Commodities Manager Ripley Atkinson gives his rationale below.
Slaughter
The report forecasts that national slaughter volumes in 2025 will reach their highest yearly volume at 9.3 million, the most since 1978 when 10.158 million head were processed.
This is higher than the forecast in January due to continued outperformance of the processing sector, large volumes of grainfed cattle coming forwards and overall higher supply of slaughter stock.
Mr Atkinson, a regular contributor to APlus News, also explained that past years’ data shows that more processing occurs in the second half of the year due in part to the many public holidays in the first half.
"It’s also when cattle supply typically seasonally peaks in the major cattle regions, which is New South Wales and Queensland,” he said.
Grainfed turnoff
The StoneX report tips Australian grainfed turnoff in 2025 to pass the 3.25 million head mark.
“I think this year we'll see higher turn off of grainfed cattle than last year, which was a record in itself,” Mr Atkinsosn said.
“The supply out of Queensland will be large. There's no question. And with the way the dynamics of meat exporting are at the minute and the profitability in that space, Southern processes will be incentivised to source stock to operate their plant sufficiently so that they can capitalise on that.
“It will be interesting to see how much grainfed cattle offset the drought cattle in southern states. Fhe genetic investment producers have made in their herds, plus grains and lot fed cattle will, I think, actually offset it more than what we probably realise.”
Exports
When it comes to exports, the report is forecasting a total of 1.531 million metric tonnes of Australian beef to be exported around the world, a 14% increase on the previous year.
Mr Atkinson went further, tipping Australian beef exports to the US to break the 2015 record, with over 415,000 tonnes to be shipped in 2025.
“I'm still pretty bullish on that,” he said. “I think they could crack higher than 415,000 it could go to, like, 430,000.”
He said this was of course under the assumption that the US tariff rate doesn’t change.
“If he (Trump) put our tariff rate up to 50% like he's doing with Brazil, well we're probably in a bit of trouble.”
The report was written before the announcement of a 50% tariff on Brazilian beef entering the US, something that Mr Atkinson believes further strengthens the Australian market.
“Under the proviso that it stays that rate of 50% from August 1, and they don't manage to reach a deal, that puts Australia in a really good spot. There'll be daylight between us and anyone else that can provide the US the volume they need, and it's not even the volume they want, it's the volume they need. Without the imports, they're going to have a big problem, and a lot of really hungry people are going to have to pay a lot more money for the domestic supply, which we know also isn't there.”
Feeder steers are costing $10.50-$11/kg in the US right now.
The report also foreshadows breaking monthly beef export volumes again in the second half of the year, at least twice.
At only a third of the way through July, we were on track to do 140,000 tonnes of beef for the month. The record was set last month at 134 something.
Mr Atkinson said July, October and December were the big months last year.
Prices
Mr Atkinson’s said it was likely that the top of the cattle market will be reached in July, before downside exposure leads to softer pricing nationally through to the end of the year, with dry weather a contributing factor here.
“As we know the weather's a major driver of the cattle market and a major driver of supply and demand and confidence at the producer level. So it's critical,” he said.
He said the price highpoint, which he also expected to last into August, is also seasonal.
"You always see the market quite dear in winter with the lack of cattle available, particularly in NSW and Victoria,” he said.
But if that rain doesn’t eventuate, there is a risk for further price drops.
“That's a risk I foresee for the market. I'm not suggesting that the market is going to go from $5 for an Angus steer to $2, that's not the point. We can't stick our head in the sands at the minute when everything's good and not think about a risk.”
Mr Atkinson said the report was a prime example of his views on the cyclicality of the industry, and the fact that we are moving to the really pointy end of all those production highs.
“It might not be this year, might be next year, but we're getting very close to the top of the cycle in terms of production,” he said.
"No one can foresee any kind of black swan event, but at the minute, it's clear sailing. The processors and exporters are coming into the best time of year, there's no disruptions now. You've got the Ekka holiday in Queensland, and Labor Day in NSW and Victoria. But other than that, they've got clear selling until Christmas, so they can get through big numbers processing cattle, and then they can get it on a ship and get it out.
“The actual export supply chain is handling the volume of product we've got in a box, so that that clearly isn't an issue at the minute. It's all setting itself up for a really big second half of the year.”