Following nearly two years of average to well below average seasonal conditions for southern Australia, stretching from Dubbo, throughout Victoria, South Australia and into southwest Western Australia – rainfall totals have steadily improved in these regions in the past six to eight weeks.
Despite the timing of the falls, generally seen as too late for a normal Autumn break prior to the colder winter temperatures setting in, the rains following drought has driven strong improvements in producers’ and subsequently the market’s confidence.
MLA’s April 2025 wave of its Beef Producer Intentions Survey (BPIS) confirmed the sharply higher shift in sentiment for southern states.
Table 1 below highlights the improvements of producers’ positivity and confidence in the 12-month outlook compared to their positions in 2024. Notably, the states recognised in the table have been entirely or somewhat affected by drought and experienced destocking and herd liquidation because of this, yet confidence has improved year-on-year. As a further reminder of improving confidence, this survey was conducted prior to the rains beginning in late May, early June.
What does this mean?There are four factors in my view that are now aligning to encourage a rebuild of the southern Australian cattle herd:
The set up – producer confidence is lifting despite the drought and prior to the rain.
The fall in producer intentions for herd reductions over the next 12 months.
Optimism around a rising market and improving seasonal conditions.
Steadily improving seasonal conditions in southern Australia at a general level.
It now becomes a case of “adding water and sunshine” – with the building blocks in place, the continued improvement in seasonal conditions (more rain) coupled with Spring approaching very quickly will give the south its best chance of a rebuild.
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I think we’ll see producers start to rebuild numbers this Spring, and price performance will reflect that attitude. The combination of the above factors acting as influencers, are supportive of a rebuild occurring.
How long that rebuild lasts, is up to how much rainfall and land deficiencies recover. We know from experience when the northern NSW/Queensland drought broke, that the land and pastures can recover extremely quickly, but the season needs to remain favourable in southern Australia for this rebuild to extend into 2026.
With two thirds of Victorian producers (67%) and half of SA producers (46%) now operating in a spring calving system – strong opportunities present themselves for producers in other regions to prepare for this rebuild and sell into a strong market, with promising producer confidence and demand pushing prices, this is particularly relevant for Angus, British and Euro producers.
Light stock and breeder articles or units stand to benefit the most in price terms for the south. Currently, PTIC articles, particularly heifers in my view, are undervalued, allowing a producer to value create, with preparing preg tested in calf (PTIC) articles for a spring market, buoyed by rebuilding intentions.
In markets where a rebuild looks likely to eventuate in some capacity, short supply and higher demand provide signals back to the seller with opportunities within the marketplace to capitalise.
Opportunities of consideration could include:
Value adds cull heifers by spring joining in preparation for a Spring sale.
Retain older cast for age cows to sell into the southern market PTIC
Buy, join (value add) younger heifers in preparation for southern demand picking up
Sell cull weaner heifers into the market earlier for southern exposure if prices justify the move.
Ultimately, there’s a multitude of options for the northern producers to consider in preparation for a southern herd rebuild, and when you remember the market’s broader reaction from previous cattle cycles – 2019 into 2020, tight supply, heightened demand and improved producer confidence, the signals are there for opportunities to be acted upon before the event happens.
Key indicators and conditions are aligning for a southern herd rebuild in Spring 2025
Market opportunities for producers to sell into a rebuild market do exist, with some producers already positioning themselves for this to transpire.
The length of the southern herd rebuild will depend on how much seasonal conditions can improve with further rains.
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.
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