BEEF | Production to lift 7.8% in 2012-13

The 2012-13 cow kill is expected to increase 15% or by 100,000 head to 843,000 cows, while bull, heifer and steer are also expected to increase 1-5%. Farmgate prices for M bull and P Steer/Heifer are expected to increase 2.5% per kg however this will be necessary to help offset the expected fall in carcass weights.

Outlook for US beef imports positive

In their latest outlook report, USDA has forecast Q3 and Q4 US beef imports to lift by a combined total of 15% (or 69 thousand tonnes) in 2012. Total beef imports for the year are projected to lift by a whopping 17% and this momentum is expected to continue into next year with imports in 2013 forecast to lift 9% year-on-year. This can only spell good news for NZ farmers with strong overseas demand likely to positively pressure prices at the farmgate provided the NZ$ plays ball. At the moment, US beef imported prices have come under pressure, which is typical for this time of year. But the outlook remains very positive towards the end of the year provided the anticipated US cow kill has little detrimental impact on demand for imported beef.

Dry causing offloads throughout Eastern Australia

Eastern Australia may be staring down the barrel of a gun with pastures rapidly drying off and in desperate need of a drink. Minimal rainfall over the past few months has left many producers in a tricky situation as most are carrying higher inventories than previous years since many have rebuilt their herds. The cautious approach of offloading is being undertaken and the influx in beef supplies is certainly pressuring prices. Increased volumes of beef product have seen Australian exporters accepting lower bids from the US and this will make life tough for NZ traders in the coming weeks, especially if the dry conditions continue.