MARKET uncertainty and today's higher transport costs appear to have wiped out the "grass fever" bidding once evident from northern buyers.
Despite the season being described as "very, very good" across parts of NSW and Queensland, northern buyers were cautious with their money at the opening Western District calf sale at Hamilton, in Victoria, this week.
It was a noticeable change on recent years when these buyers created the impression that if they had feed then money was really no object to getting numbers.
While northern agents denied they had ever bought cattle willy nilly, so to speak, their more subdued bidding on Monday did become a talking point.
Local buyer Noel Reeves, from Mt Helen, in Victoria, said he had expected a stronger showing from the north.
"They seem to be feed driven, so I actually thought it might have been a bit dearer as in the past they haven't appeared to be too worried about what they have paid," he said.
So what has changed?
A key problem this New Year appears to be the lack of forward price signals and contracts from feedlots and processors, which has undermined buyer confidence, especially for volume buyers in the north.
With the world economy in crisis and key beef markets such as Japan and the US struggling financially, the export meat sector has become more guarded than usual, agents said.
NSW agent Andrew Hosken, of Elders in Tamworth, said calf buyers were having to wear more risk this time around as there was little information and deals on offer from those further down the production chain.
"We are buying on a hit and a hope really," he said.
There was also claims that the global financial meltdown has had an impact on the amount of corporate or business money available to buy calves this year.
"Any blokes that had money offshore, or investments in Melbourne and Sydney, are much quieter," was one comment.
Landmark agent Mark Barton, who oversees some large northern accounts, said the global meltdown had changed the cattle landscape.
"Some of the corporates are not in the market like they were a year ago as there is not the cashflow available," Mr Barton said. "And some guys that bought numbers of cattle for cattle's sale - it wasn't their key business - are not there."
Mr Barton said the uncertainty surrounding the beef market had prompted some clients, that had high-quality pastures, to diversify into lamb finishing this season.
"Usually we have a feel for what the (cattle) market is going to do, but we don't have that at all at the moment, whereas the lamb market looks fairly solid," he said.
However, there was also the argument that the reason for the quieter performance of northern buyers was much simpler - being freight costs and the fact there is more competition from southern restockers this New Year after late rain.
With transport still costing between $4.60 to $5 per kilometre, agents sending cattle north had to add anything from $50 to $100 a head to the purchase price.
Add that sort of money to a calf that is already more than $600 a head for the top steers, and the sums don't add up too well based on current returns for feedlot and slaughter cattle.
Even local buyers such as Michael Palm, from PPHS at Penola, in South Australia, said calf prices were strong considering most finished cattle were returning less than 180c/kg liveweight.
"We are certainly paying enough considering where the fat (slaughter) market is," he said.
- FORTHCOMING SALES
- VLE PAKENHAM: Tomorrow, 10am, store sale. Assoc. agents.
- HAMILTON: Tomorrow, noon, 2765 Hereford Euro steer weaners. Assoc. agents.
- NARACOORTE: Tomorrow, 12.30pm, 4000 weaners. Assoc. agents.
- WODONGA: Tomorrow, 10.30am, 4500 Angus mixed sex. Assoc. agents.
- WODONGA: Friday, 10.30am, 3500 Hereford, black baldy and Euro cross. Assoc. agents.
- VLE KOONWARRA: Friday, 11am, 1200 head. Elders.
- CASTERTON: Friday, noon, 3300 steer weaners. Elders.
- YEA: Friday, noon. 2800 head featuring joined females. Assoc. agents.
- CAMPERDOWN: Friday and Saturday. Friday, noon, 1100 joined heifers. Saturday, 10am, 900 unjoined heifers. Assoc. agents.
- KYNETON: January 14, 12.30pm, 1400 weaner and grown cattle. Assoc. agents.
- HAMILTON: January 14, noon, 2900 all breeds heifer weaners. Assoc. agents.
- HAMILTON: January 15, noon, 4020 all breeds heifer weaners. Elders and Landmark.
- MANSFIELD: January 15, 10.30am, 1000 head. Rodwells.
- YEA: January 15, 1pm, 3000 head in special weaner sale. Assoc. agents.
- WODONGA: January 15 & 16, 10.30am, two-day female F1 and beef-bred sale. Assoc. agents.
- EUROA: January 16, noon, 1500 weaners. Assoc. agents.
- WARRNAMBOOL: January 16, noon, 3000 weaners. Assoc. agents.
- CASTERTON: January 16, noon, 2100 heifer weaners. Elders.
- COLAC: January 23, noon, ???? head. Assoc. agents. SHEEP
- BALLARAT: Tomorrow, noon, 18,000 cross-bred ewes. TB White and Sons.
- TUNBRIDGE (Tas.): Tomorrow, 1pm, 2350 Corriedale and crossbred ewes. Roberts.
- KYNETON: Friday, 1pm, 10,00 first-cross ewes. Assoc. agents.
- DENILIQUIN: January 14, noon, 23,000 Merino and first-cross ewes and fattening lambs. Assoc. agents.
- DENILIQUIN: January 16, 14,000 Merino wethers 2008 and 2007-drop. Assoc. agents. DAIRY
- WARRAGUL: January 16, 11am, bi-monthly sale. Scott & Elders
BEEF CATTLE
