A historically high cattle market has pushed cattle-on-feed numbers lower for the September quarter. Confidence in the sector has far from waned, however, with capacity, turn-off and grainfed exports all rising over the three month period. While utilisation also dipped from its record level set in the previous quarter, it remained on par with year ago levels. Demand also remained strong, with the National Feeder Steer Indicator increasing significantly despite an equally large increase in throughput.
There were 1.52 million head of cattle on feed in the September quarter, a dip of 4% from the previous quarter, but still the second-highest number on record. It was a nearly 7% increase on the same quarter in 2024, and 29% above the five-year average for the period. It was the first quarter-on-quarter fall in cattle on feed in 11 quarters, with numbers coming in lower in every state.
The real strength of these sustained near-record numbers is highlighted by a record turn-off in the quarter of 962,436 head, up 8% from June. This in turn meant grainfed beef exports rose 7% for the June to September period to a record quarterly figure of more than 121,000 tonnes. Capacity also rose, up 3% from the previous quarter to a record 1.74 million head.
These two factors prompted a dip in utilisation, back to 87% from the record 93% set in June. The five-year average utilisation for the September quarter is 77%, with capacity having risen 18% over that period. Queensland and NSW utilisation remained above the national utilisation rate at 91% and 87% respectively. In NSW, where utilisation was 95% the previous quarter, cattle-on-feed numbers fell by less than 1% from June, however, capacity lifted 7%. Figures fell across the board in South Australia, with numbers on feed down 22%, while utilisation in WA, which is traditionally lower in the September quarter, was just 50%.
The National Feeder Steer Indicator climbed 20% from the start of July to the end of September, despite throughput for this indicator also rising by 13%, its highest level since 2015, according to the National Livestock Reporting Service. It ended September about 35% stronger than the same time in 2024 and the 10-year average, and 20% above the five-year average. It averaged 455¢/kg for the quarter, nearly 100¢/kg less than the same period in 2024, and 38% lower than 2023; however, it remained about 40¢/kg below average for the 2021 and 2022 quarters.
In what has been the first real quarterly test of cattle market impact on lotfeeding figures since 2022, the lotfeeding sector has continued to grow. While sustained high prices will likely put some downward pressure on placements, grainfed now makes up close to 30% of all of Australia’s beef exports, and that demand isn’t expected to diminish. September’s record beef production, despite consecutive difficult seasons in the south, was no doubt supported by the increase in lotfeeding capacity across the country. Its importance to producer returns is only likely to grow from here.