Meanwhile, Australian beef production has remained high and exports hit new records as cattle prices have started to lift, the agribusiness banking specialist says in the quarter three report.
Report lead author, RaboResearch senior animal proteins analyst Angus Gidley-Baird, said beef markets had seen record production and exports in Brazil in quarter two, while China had a record volume of imports in the first half of the year.
Production volumes in the United States were higher than expected and prices in Europe had remained “remarkably strong”.
Looking forward, the report says, beef markets are waiting for signals of what is expected to unfold — most significantly a contraction in US production, improved cattle prices in Brazil and a possible reduction in consumption in the US following both the end of summer grilling season and persistent high beef prices.
Cattle prices continue on different trajectories across markets, with North American prices remaining at elevated levels and Southern Hemisphere prices — while still at significantly lower levels than the US —showing some signs of life, although Brazil’s prices have drifted lower.
In Australia, beef production volumes and exports remain strong, the report says.
Seasonal conditions continue to be favourable in most cattle-producing areas of the country, Mr Gidley-Baird said.
“Dry conditions in southern areas in the first half of the year have limited the numbers of heavy finished grass-fed cattle, but good seasonal conditions in the north continue to support high slaughter numbers,” he said.
“Weekly Australian cattle slaughter numbers remain around 140,000 head per week, up 20 per cent on the five-year average.
“Given our expectations for the number of cattle in the system, we believe slaughter numbers will continue at these rates into the latter part of the year.”
The report says Australian beef export volumes in July (of 129,998 metric tonnes swt) were the largest volumes ever exported, passing previous peaks in 2019 and 2015.
Mr Gidley-Baird said Australian beef export volumes to the US for July 2024 were the highest since December 2015 and to Japan, the highest since March 2020. However volumes to China were down.
The report said Australian cattle prices rose sharply in July, particularly finished steer and cow prices, which lifted 15 per cent and 32 per cent respectively in the month.
”Prices have since levelled off a little, but remain on an upward trajectory,” Mr Gidley-Baird said.
If US import prices peaked again in quarter four — as was a typical pattern — Rabobank would expect to see Australian cow and finished steer prices creep up further.
