Q1 2025 slaughter and production data provides further evidence to the move towards cyclical highs in the cattle cycle.
Victorian cattle slaughter in the top 8% of quarters of all time.
The growth in grainfed beef production continues to take shape, despite no widespread drought conditions for the eastern seaboard.
This week, the Australian Bureau of Statistics (ABS) released the Quarter 1 2025 slaughter and production volumes, providing a detailed breakdown of how Q1 performed.
These results reaffirm my view that the cattle cycle continues to build towards production highs and in some instances on a state basis, production and slaughter volumes are reaching levels not seen in more than 40 years.
Victorian cattle slaughter to its highest level since 1979 (of any quarter).
And the top 8% of quarterly slaughter volumes of all time.
NSW cattle slaughter to its highest level since Q1 2015 (of any quarter).
National beef production to its second highest volume on record (of any quarter).
National slaughter volumes 366,000 head higher than Q1 2024.
Take Victorian slaughter for example, reaching its highest quarterly level in more than 40 years. The volume looks significant and no doubt herd liquidation in the south is contributing to this. However, there’s more at play for Victoria than just drought conditions and here’s why;
Large volumes of northern cattle (NT, QLD, WA), particularly cows, have made their way south to Victoria for processing in the past 12 months, as the processor exporters seek to keep their plants full and capture strong profitability opportunities.
These processors have buyers stationed in the north to buy big numbers which are then trucked south into Victoria for processing and export.
A number of Victorian plants have invested heavily in processing upgrades in the past five to six years, driving higher production capacity and output, these investments are starting to flow through in the figures we’re seeing.
South Australia is another strong example, where slaughter numbers are now at their highest level since prior to the Murray Bridge TFI fire in January 2018. It should be expected that we continue to see these volumes ramp up.
In addition to this, the growth of the grainfed sector in South Australia will ensure consistent, weekly supply of cattle to fill grassfed gaps which can occur seasonally.
These numbers shouldn’t surprise us – this has been five years in the making.
Consider the growth of 366,000 head in slaughter volumes compared to the same quarter 12 months ago. Or consider the fact that Q1 25’ slaughter was 62% or 833,000 head higher than Q1 2022 at the bottom of the rebuild three years ago.
All of these higher volumes shouldn’t surprise us, there’s no truer reflection of the serious increase in the growth in the herd to 20-30 year highs in my opinion. And in turn the large supply of both grass and grainfed slaughter cattle and finally the processing sectors sharp rise in throughput which I’ve discussed in this column previously.
These outcomes have been five years in the making following the rebuild years of 2020 to 2022 and I’m of the firm view we’ll continue to see growth in these volumes to seasonal highs later in 2025.
The next 12-18 months are going to be very interesting to watch and analyse how far slaughter and beef production can really go. I’m of the belief it will continue to defy us and volumes will outperform our general expectations and forecasts, most likely including my own.
In the past five years, total national cattle on feed numbers at a quarterly level have lifted 37% or 410,000 head. The continued, steady growth in the feedlot sector, at capacity, numbers on feed and utilisation levels ultimately are driving higher turnoff numbers out of feedlots despite days on feed rising at the same time
What this is resulting in, is a continued steady rise in grainfed beef production as a share of total. Q1 2025 grainfed turnoff reached 858,000 head, the third largest quarterly turnoff volume on record. We can expect to continue to see increasing rates of grainfed turnoff numbers as 2025 continues, particularly with feedlot utilisation at record levels and large availability of feeder cattle. Feedlots may look to shorten days on feed to drive higher turnover which will push more numbers through the system this year.
I’ve analysed this structural shift in this previous column, which began following the 2013-15 drought.
Ripley Atkinson's experience in the red meat industry and current role at StoneX developing price risk management tools for Australia’s sheep and cattle sectors ensures he delivers unique, whole of supply chain insights and analysis across key factors such as prices, supply, production and the drivers of the sheep and cattle cycles.
StoneX Disclaimer The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided. References to over-the-counter (“OTC”) products or swaps are made on behalf of StoneX Markets LLC (“SXM”), a member of the National Futures Association (“NFA”) and provisionally registered with the U.S. Commodity Futures Trading Commission (“CFTC”) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ (“ECP”) and who have been accepted as customers of SXM. StoneX Financial Inc. (“SFI”) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI is registered with the U.S. Securities and Exchange Commission (“SEC”) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Adviser. References to securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to exchange-traded futures and options are made on behalf of the FCM Division of SFI . StoneX is a trading name of StoneX Financial Ltd (“SFL”). SFL is registered in England and Wales, Company No. 5616586. SFL is authorized and regulated by the Financial Conduct Authority [FRN 446717] to provide to professional and eligible customers including: arrangement, execution and, where required, clearing derivative transactions in exchange traded futures and options. SFL is also authorised to engage in the arrangement and execution of transactions in certain OTC products, certain securities trading, precious metals trading and payment services to eligible customers. SFL is authorised & regulated by the Financial Conduct Authority under the Payment Services Regulations 2017 for the provision of payment services. SFL is a category 1 ring-dealing member of the London Metal Exchange. In addition SFL also engages in other physically delivered commodities business and other general business activities which are unregulated and not required to be authorised by the Financial Conduct Authority. StoneX Group Inc. acts as agent for SFL in New York with respect to its payments services business. StoneX APAC Pte. Ltd. acts as agent for SFL in Singapore with respect to its payments services business. StoneX Financial Pty Ltd (ACN 141 774 727) holds an Australian Financial Service License (AFSL: 345646) for Dealing in Securities, Exchange-Traded Derivatives Contracts, OTC Derivatives Contracts and Foreign Exchange Contracts, and is regulated by the Australian Securities and Investments Commission. ‘StoneX’ is the trade name used by StoneX Group Inc. and all its associated entities and subsidiaries. Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. Past performance of any futures or option is not indicative of future success. Indicators are not a trading system and are not published as a specific trade recommendation. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.
