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Tuesday, April 02, 2019

Heavy weaners in demand across the Strait

By Matt Dalgleish  |  Source: MLA, Mecardo

Key points

  • Tasmanian weaners sales are averaging 295¢ kg lwt during March, down 4% from the 2018 average price
  • Weaner steers have achieved an average price of 330¢, while weaner heifers are earning an average of 260¢
  • Weaners above 280kg liveweight have been achieving premium price spreads to mainland EYCI type cattle that are three to five times higher than the ten-year average spread

 

2019-04-02 Cattle 1

2019-04-02 Cattle 2

2019-04-02 Cattle 3

 

We are a month in to the annual weaner sales in Tasmania and while weaner prices are on par with last season there are some interesting developments when comparing price spreads to the mainland – particularly for the heavier weaners.

Tasmanian weaner prices have eased slightly, down 4% compared to last season, with the average price of 295¢/kg lwt achieved during March for heifers and steers at the Powranna sales. Weaner steers have averaged 330¢, while weaner heifers have earned 260¢. 

Figure 1 demonstrates the price trend for Tasmanian weaners, according to weight classifications, with the heavier stock holding their value the best. Prices for weaners weighing above 330kg liveweight are 3.7% below levels achieved in 2018 and weaners in the weight range between 280-330 kg are off 3.6%, not too bad considering the southern restocker Eastern Young Cattle Indicator (EYCI) is 13.4% lower than in 2018.

Analysis of the spread pattern for different weaner weight classification to the southern restocker EYCI highlights that the spread for heavier weaners has been steadily improving since 2015 – Figure 2. This is particularly true for weaner steers weighing above 280 kg liveweight with premium spreads being earned during 2019 that are three to five times greater than the average spread earned over the last ten years.

Indeed, weaners weighing more than 330kg lwt have achieved an average spread premium of 67¢ above the southern restocker EYCI during the March sales, compared to an average of 13¢ premium over the last ten years.

For a full copy of the Tasmanian Weaner Sales Report for March 2019 contact Roberts Livestock

What does this mean?

The surge in the heavy weaner spread premiums can be demonstrated by the percentage spread pattern to the southern restocker EYCI for the last fifteen years – Figure 3. For much of the period the percentage spread premium was confined to a 0-10% range. However, in 2018 the spread lifted to a 17% premium and during March of 2019 has jumped to 30%.

Anecdotal reports from the Powranna sales suggest that the robust demand for heavier weaners was fueled by competition amongst feedlot backgrounder and finisher buyers. Given the expectation of tight supplies of quality finished cattle as we head toward winter the solid demand for heavier weaners now isn’t surprising.

Mecardo information is provided to assist in your marketing decisions. It contains a range of data and views on the current market. It is not intended to constitute advice for a specific purpose. Before taking any action in relation to information contained within this report, you should seek advice from a qualified professional. The information is obtained from a variety of sources and neither Mecardo nor Ag Concepts Advisory will be held liable for any loss or damage whatsoever that may arise from the use of information or for any error or mis-statement contained in this report. 

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