Beef boom set to continue

Grazing property, like this land at Goomboorian, is expected to remain in high demand.

By Arthur Gorrie

Gympie region’s cattle price and farm property boom is set to continue in the New Year, driven by continuing demand and a contraction in the US cattle herd, according to major Dutch international loans group, Rabobank.

The agribusiness banking specialist said contracting production in the US – one of the world’s most influential market movers – would alter global trade flows and have implications for other “trade exposed beef nations”, including Australia.

The growth in US beef exports to China is claimed to be supported by “limited supply out of Australia, due to our herd rebuild process and reduced cow slaughter, the bank said.

Another factor would be continuing disruption to export supply from Argentina and Brazil, and a growing Chinese demand.

Strong domestic beef demand in the US is likely to keep the door open for Australian producers, Rabobank says.

It says declining world supply is not likely to change until 2023 or beyond.

Rabobank says forecast favourable seasonal conditions in the coming months would support strength in producer demand and provide support for young cattle prices.

The bank’s bad news for Gympie region cattle producers and cattle property vendors is that Covid remains a challenge.

The report said the global shipping disruptions that pushed prices to “stratospheric levels in 2021” are set to continue in 2022 and, as a result, containerised freight costs, especially for refrigerated containers would remain high.

Combined with the reluctance of Australian graziers to sell stock during a phase of herd rebuilding, the bank predicts a bullish market.