The lotfeeding sector continues to find new highs, with 2024 closing out as its biggest year yet. Significant increases in capacity, numbers on feed and turnoff were made, and these levels look set to stay as the demand outlook for Australian grassfed beef is set to improve further in 2025.
The number of cattle on feed for the December 2024 quarter rose to a new high of 1,450,481 million head, equating to 87% utilisation of the available capacity. This was more than 27% above the five-year average, an increase of 12% year-on-year, and nearly 2% higher than the previous quarter. Capacity was also at a new high, allowing utilisation to remain at the same level as the previous quarter and 6% above the same time last year. For the October-December 2024 period, 1.65 million head of feedlot capacity was available across Australia, driven by increases in NSW and South Australia.
There were 3.14 million head of cattle marketed out of feedlots in Australia in 2024, the largest number on record, 11% above the five-year average and 16% more than the previous year. This equated to 375,195 tonnes of grainfed beef being exported last year, a record total volume and 15% more than the previous year. Japan maintained a majority market share of Australia's grainfed beef for the year, increasing their imports by 14%, but for the December quarter, China overtook them, taking in nearly 30% of the volume and increasing their annual intake by 18% year-on-year.
The US Department of Agriculture is forecasting that fed beef production will fall in 2025, albeit only by just more than 1%, and data set to be released next week will show their numbers on feed will be about 1.3% lower year-on-year as of the start of February. The US herd is at historic lows, and a ban on feeder animals coming into US feedlots from Mexico has impacted the grainfed sector further. While this hasn’t started to cut into fed cattle slaughter yet, it is expected to from the middle of this year, and US beef exports are forecast to be 12% lower year-on-year in 2025.
Feeder cattle throughput was up 25% year-on-year in 2024, according to Meat & Livestock Australia. A dry end to spring for much of the south encouraged feeder rather than finished turnoff, boosting supply. This prompted the December national feeder steer indicator price to drop from the previous quarter to 347c/kg lwt. The indicator averaged 338c/kg lwt for 2024, which was 26c/kg firmer year-on-year but below the five-year average. So far this year, that price has lifted to an average of about 369c/kg lwt and closed last week at 352c/kg lwt. This was right in line with the 10-year average but 14% lower than the five-year average.
With cattle supply expected to remain where it is for the medium term, the feeder steer price too should maintain its current trajectory. When this is teamed with current lower feed prices, as well as the strength of our export markets, a lacklustre Australian dollar and increased processor, the lotfeeding sector has likely got another bumper year ahead of it.
Jamie-Lee Oldfield is a seasoned agri-media, communications professional and livestock market analyst who lives and works on a family-owned stud and commercial beef and sheep operation in Coolac, NSW.