Meating the Market

AUSTRALIA - Domestic or export? Heavy or light? Background or finish? Organic, grassfed, grainfed, Meat Standard Australia ... the myriad of options for marketing livestock is complex for Australia’s producers.
calendar icon 6 September 2012
clock icon 2 minute read
Meat & Livestock Australia

However, one thing is certain. Meeting the specifications of your target market is one way to improve profitability.

MLA’s Manager Market Information and Analysis Tim McRae recommends numerous tools for producers to use in planning the destination for their production.

“In February and August each year, MLA releases market projections which outline what our customers are up to – who is buying more, who is buying less, what type of animals they are after,” he said.

“The marketplace can change quickly as we have seen in recent times, for example, with the decrease in global demand for grainfed heavy steers but an increase in manufacturing beef demand from the US.”

As to the lamb market, Mr McRae advised producers to keep abreast of market indicators.

“Specifications vary from market to market, from lighter lambs to the Middle East, through to heavier lambs for the US market,” he said.

“The signals combined with seasonal factors need to be taken into account when managing the turn-off of lambs.”

Tim said producers can use projections, along with information about the global and domestic economy, exchange rates, weather forecasts and local supply information, to plan how and when their stock is sold.

“At times producers have the ability to hold on to stock for longer, which can increase profits. Other times there is more to be made by selling them lighter,” he said.

“Sometimes it’s seeing that cows in calf are selling just as well as cows with a calf at foot and making the call to sell into that market.”

From the latest industry projections, Tim identified five key messages for producers. Australian livestock numbers continue to grow and our increased production will be largely exported. These exports continue to grow to newer markets, along with increased growth to the US.

Global economic conditions continue to impact consumer demand – particularly for beef with conditions difficult in Japan, Korea and Indonesia.

Three steps to meet market specifications:

  • Manage the nutrition, health and welfare of sale animals to meet target market specifications on time.

  • Manage livestock in a low stress manner two to three weeks prior to sale and during mustering and transport to achieve optimal carcase dressing percentages and avoid downgrading.

  • Regularly evaluate market opportunities as feed supply, cashflow or market prices change and select markets which maximise profits.

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