Is there any Room Left for Cattle Prices in 2021 after a Record January?

Cattle numbers totalled 45,162 head for January 2021, a 69% increase from January 2020 when 26,732 head were offered. Given the vastly different seasonal conditions at play across these two times, the increased listings in 2021 has been assisted by producers desire to cash in on a record cattle market. Contrasted with January 2020, which was at the tail end of a severe drought that had decimated the national cattle herd, with producers in some areas having destocked entirely, resulting in a considerably lower amount of listings.

When reviewing state listings between the months it illustrates a story of two completely different markets. NSW listings fell by 11% due to their need to restock after years of prolonged drought conditions. For other states in 2021 it tells a story of an all-time record market where producers wanted to cash in on amazing prices and bring their stock to a national market and fill demand from New South Wales. Highlights include Queensland, which increased its total listings by 5%, as producers looked to capitalise on heightened demand coming from the south.

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For January 2021, the average AuctionsPlus price for all heifer weight categories increased by an average of 63% on the same period 12 months earlier, while steers increased by an average of 50% across all weight categories. The heifer price increase illustrated the desire for breeding stock, as producers looked to restock in January 2021 after a vastly improved 2020 season.

Driven by the desire to either restock after years of drought, or repurchase to maintain and fulfil future supply chain commitments, the demand for a limited supply of suitable young cattle was unprecedented in January 2021 – highlighted by the record prices registered at weaner sales. In January 2021, AuctionsPlus recorded a monthly average for 300-400kgs weaner steers of 491c/kg lwt, just two cents shy of the 493c/kg lwt average received in weaner week (first full week of January 2021).

In contrast, weaner heifers in January 2021 averaged 473c/kg lwt, while prices for the weaner week in 2021 averaged 483c/kg lwt.

Similar, prices throughout January for ready to breed stock were a vendor’s delight, while buyers started to baulk late in the month, as the cumulative total for cow & calves got very expensive. NSM cows and CAF averaged
$2,788/head in January 2021, a 125% price increase, joined cows and calves recorded an average of $2,857/head, up 100%, while joined heifers averaged $2,312/head, up 59%, year-on-year.

Interestingly, in the past 20 years, there has only been one occasion, in 2012, where the average January young cattle price has been the monthly high for the year. In January 2012, the EYCI averaged 404c/kg cwt, which was the highest monthly average for 2012 – in a year where prices finished the year approximately 18% lower by December. 2012 is a year of note, as it followed the two wettest years on record, in 2010 and 2011, and a national herd rebuild was in full stride, with additional young cattle supplies hitting the markets as the year evolved.