PROGRESS towards signing a live cattle agreement with China could add further security to an already record-breaking market locally, though farmers are relying on the current buoyancy of the cattle job to continue restocking.
Early last week, Minister for Agriculture Barnaby Joyce put pen to paper to extend Australia’s live cattle trade with China, a deal which could see within the next decade Australia delivering a million head to China every year, potentially doubling the size of current trade.
Mr Joyce said the Australian and Chinese veterinary authorities were in the process of formalising agreement on animal health certification requirements and it was now up to his Chinese counterpart, Zhi Shuping, to sign off and finalise the agreement.
BR&C livestock agent and auctioneer John Sawyer said it was too early to predict what impacts the agreement would have locally, as it could take years to establish trade.
However, it would potentially serve to add more demand to an already strong cattle market and offset a significant reduction in Indonesian exports if it chooses to drag out its decision this month to take 200,000 fewer head of cattle over the next three months compared to the same period last year.
“The way the cattle job is at the moment, it’s driven by domestic orders and there’s hardly enough cattle for our own market, so it’s probably only going to add demand with another market like that coming on board,” Mr Sawyer said.
“The cattle market is going at unprecedented prices, prices never seen before. It’s still uncharted waters where we are at the moment as far as where the cattle price is.”
The market’s continued buoyancy was evident at the Swan Hill Regional Livestock Exchange last Thursday, where small calves fetched 10 to 20c/kg higher to reach $4.06/kg, while 430kg steer made $3.44/kg and 550kg steers sold at at $3.40/kg.
Mr Sawyer said there was industry-wide confidence the skyrocketing prices would continue into the near future.
“It is looking very good, given all the processes and what the people in the industry you talk to are saying,” he said.
“This sort of level is going to be around for a while, maybe not the great heights it is at the moment, but even if it came off a little bit it will be very, very good.”
However, it wasn’t all good news for cattle farmers.
The recent sky-high prices have largely been offsetting higher production costs, so farmers have been relying on them staying where they are to get value for money.
“A lot of people are saying it probably needs to be at these levels for producers to stay in cattle, with the price of grain at the moment, the price of hay, the price of water – which is over $200 a megalitre,” Mr Sawyer said.
“We need to be getting this for cattle, otherwise the numbers don’t stack up.”
For more on this and other stories, grab a copy of Monday’s Guardian (July 27).
