Australian 2018 Beef Cattle Seasonal Outlook: Prices off the Boil, but Set to Simmer Nicely

While domestic cattle prices have come off the boil, Rabobank expects them to more or less stabilise over the balance of 2018, and come in at 15% below prior-year levels for the year. The 2018 Eastern Young Cattle Indicator is expected to average AUc 513/kg cwt for the year, which is just above the five-year average.

picture of Australian beef chain

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With improved numbers in southern states, Rabobank expects cattle slaughter to rise marginally and agree with the MLA forecast for a 3% increase in slaughter, to 7.4m head.

Rabobank expects the number of cattle on feed to remain high, and – with lower cow kill and heavier grass-fed cattle weights as a result of the better seasons – average slaughter weights are expected to remain stable in 2018. This will result in an overall increase in production of 3%. 

Global markets are not expected to provide much upside support, as Australia faces increasing competition in key export markets over the course of the year. 

With price declines more than offsetting the small rise in beef production, producers’ incomes will generally fall in 2018. Nonetheless, we expect producers will still enjoy a profitable 2018.