Record Aussie beef prices heading for 1,000c
Australia's beef prices have defied analyst expectations to charge through supposed ceilings, with a magical 1,000 level in the herd's sights.
The Eastern Young Cattle Indicator (EYCI) as at Wednesday afternoon had pushed up to a new record 951c per kilogram of carcase weight (cwt), continuing to re-write records.
While Australia's herd rebuild after destocking in the recent drought is seeing farmers holding on to stock - and hunting for more - international factors are also at play.
Comparison with recent price activity in the United States shows that while their price has recovered to US$118 per lb cwt - the same as it was a year ago - their record was in 2015 when it reached US$145.
One international driver for demand is Argentina's move on banning beef exports to keep a national favourite affordable. According to AusTrade, Argentine prices had increased 64.7 per cent between April 2020 and April 2021. The first 30-day export ban occurred on 19 May, but it was recently extended until the end of August, and could run until the end of the year. Argentina was the fifth largest global beef exporter in 2020, and China's second-largest beef supplier (at 20 per cent of their demand).
The Australian market will also be bullish on the back of the in-principle agreement to a free trade agreement with the United Kingdom, where beef meat was a major sticking point in the negotiations.
Demand for Aussie beef could be the highest it has ever been, and if the EYCI 1,000 level is breached for the first time in coming months, could see more lamb on the barbecue this coming summer.
The latest updates on beef prices, as well as sheep, dairy, wool, wheat, barley, canola and more appears every Friday at FlowNews24 in 'Your Friday Farmgate' in the Agriculture tab.
Wayne Phillips spoke about the bull market on beef on FlowFM on Thursday: