alma conference – bendigo...
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ALMA conference – Bendigo 2016 Ben Thomas – Manager, Market Information July 2016
About MLA Meat and Livestock Australia Ltd (MLA) strives to be the recognised leader in research, development and marketing.
MLA delivers value to levy payers by investing in initiatives that contribute to:
• Producer profitability
• Sustainability
• Global competitiveness
MLA is a producer owned, not-for-profit organisation and not an industry representative body.
EYCI at record highs – what to expect ahead?
100
200
300
400
500
600
700 ¢
/kg
cw
t
Source: MLA
Good rain and more to come
• Past three months has seen above average rainfall across most of the country
• BOM forecast a 50% chance of El Niña in second half of 2016
Cattle herd to bottom out in 2016
15
17
19
21
23
25
27
29
31
33
35
mil
lio
n h
ea
d
Source: ABS, MLA estimates
20-year low herd
Female percentage of adult cattle slaughter*
42%
43%
44%
45%
46%
47%
48%
49%
50%
51%
52%
Fem
ale
% o
f ad
ult
catt
le s
lau
gh
ter
Source: ABS *=rolling 12 month average
Drought
Drought Drought
The rise of Brazil • Exports in 2015-16 were up
3% year-on-year
• Have recently gained access to China and Saudi Arabia
• US access is still on the table – could possibly still happen this year
• A struggling economy
(sluggish domestic demand), an extremely weak currency and reopened markets will underpin exports
Brazil is pushing a lot of product into China
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
2012 2013 2014 2015 2016
tonnes swt China Hong Kong Australian exports to China and Hong Kong
Brazil gained re-entry mid-2015
Source: Global Trade Atlas, DAWR
Conclusions for Beef • 2016 will remain a solid year for beef cattle prices – underpinned by restockers
• Cattle prices are cyclical, and downward price pressure will inevitably mount
• The lows though, are unlikely to fall below 2014 levels
Trade lamb prices surging
400
450
500
550
600
650
A¢/k
g c
wt
2014 2015 2016
Source: ABS, MLA forecasts
Unusually steady Australian sheep flock
0
20
40
60
80
100
120
140
160
180
200 19
45
1947
19
49
1951
19
53
1955
19
57
1959
19
61
1963
19
65
1967
19
69
1971
19
73
1975
19
77
1979
19
81
1983
19
85
1987
19
89
1991
19
93
1995
19
97
1999
20
01
2003
20
05
2007
20
09
2011
20
13
2015
20
17f
2019
f
Mil
lio
n h
ead
Source: ABS, MLA estimates
Wool boom Crop expansion, poor wool prices
Breeding ewes trending lower, lambs increasing
0
10
20
30
40
50
60
70
80
90
100
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f 2017f 2018f 2019f 2020f
Mil
lio
n h
ead
Breeding ewes one year and over Slaughter lambs All other Source: ABS, MLA estimates
Sheep and lamb saleyard throughput
0
2
4
6
8
10
12
14
16
Mil
lio
n h
ead
Lambs Sheep Total Linear ( Total )
Lamb slaughter* most stable its ever been
1.3
1.4
1.5
1.6
1.7
1.8
1.9
2.0
Mil
lio
n h
ea
d
-9%
-2% (with drop and rise) +14%
+11%
+23%
-13%
+4%
Source: ABS, MLA estimates *=rolling 12 month average
Lamb slaughter* most stable its ever been
0
100
200
300
400
500
600
1.3
1.4
1.5
1.6
1.7
1.8
1.9
2.0
¢/k
g c
wt
Mil
lio
n h
ea
d
lamb slaughter trade lamb prices
-2% (with drop and rise) +14%
+11%
+23%
-13%
+4%
-9%
+35%
-25%
+25%
+35% -8%
-9%
+45%
Source: ABS, MLA estimates *=rolling 12 month average
Conclusions for lamb
• Prices to remain supported by reduced NZ competition
• More stable supply should assist reducing market volatility
• Relatively stable national flock expected for next 5 years
MLA’s new market info mobile application
• Promoting saleyards
• All the national indicators
• All market news
• Interactive map
• Ability to tailor market indicators
• Detailed saleyard report analysis
• Save market reports
• Linked to “MyMLA”
MLA’s Market Information – [email protected] • Market Information app
• Market Statistics Database
• Industry Projections
• Meat and Livestock Weekly
• Daily text message
• Daily indicators
• OTH reports for every state
• http://www.mla.com.au/Prices-markets
How to access MLA Market Information
• Online – http://www.mla.com.au/Prices-markets
• Call NLRS hotline (02) 9436 9372
• Email - [email protected]
• MLA app – free from app store
Thank you
Ben Thomas [email protected]
0400 300 612
• All use of MLA publications, reports and information is subject to MLA’s Market Report and Information terms and conditions.
• Terms of use at www.mla.com.au
Disclaimer To the best of MLA’s knowledge the information contained in the publication accurately depicts existing and likely future market demand. However, forecasts and projections are imprecise and subject to a high degree of uncertainty.
MLA makes no representations and to the extent permitted by law excludes all warranties in relation to the information contained in this publication. MLA is not liable to you or to any third party for any losses, costs or expenses, including any direct, indirect, incidental, consequential, special or exemplary damages or lost profit, resulting from any use or misuse of the information contained in this publication.