Making ends meat
The Snapshot
- Currently, it would cost 107% of the average weekly wage to buy a heavy steer.
- The last time the heavy steer price was this expensive, in average weekly wage terms, was in 2001 when it cost 111% of the weekly wage.
- In contrast it takes about half a days work (or just under four hours of a forty hour working week) to afford to buy a trade lamb and is the most expensive trade lambs have been (in wage terms) since the early 1980s.
The Detail
Anyone that has been watching cattle and lamb markets would know that prices for livestock are red hot at the moment. However, have you ever wondered how the current high cost of livestock compares to the average Australian weekly wage?
According to the Meat and Livestock Australia’s indicator specifications guide a heavy steer weighs between 500-600 kg live weight, so we have based our dollar per head value of the heavy steer on a 550kg steer. Annual average prices for heavy steers have been converted into dollar per head figures and then divided by the average Australian weekly wage, as reported by the Australian Bureau of Statistics.
Current figures show that to buy a 550kg heavy steer it would cost 107% of the average weekly wage or about $1,900. The last time the ratio between heavy steer values to wage levels was this high was back in 2001 when it cost 111% of the weekly wage.
Interestingly, heavy steers were much less affordable prior to the 1970s cattle market crash. Between 1950 to the mid 1970s the price of a heavy steer was worth more than two weeks wages, sometimes stretching beyond three times the weekly wage. Since the 1980s the price of a heavy steer has been fluctuating between 50% to 150% of the weekly wage.
Using a similar methodology to calculate the dollar per head value of a trade lamb, based on a 20kg carcass weight lamb, we can see that lambs are a much more affordable purchase for the average worker which is unsurprising given their lighter weight, lower meat production and cheaper dollar per head figure than the heavy steer.
The current trade lamb price to weekly wage ratio sits just shy of 10% of the weekly wage, at approximately $165. This demonstrates that it takes about half a days work (or just under four hours of a forty hour working week) to afford to buy a trade lamb. This is the most expensive trade lambs have been since the early eighties. However, back in the 1950s it cost nearly a third of the working week, or a day and a half, to afford to buy a trade lamb.
