Market Morsel: A horror start
This week saw the beef processor Greenhams close part of their plant in Tongala and in December a NSW processor closed for eight months as of the start of 2021. Taking a look at the EP3 beef processor margin model for the start of the season it is pretty clear that it has been a shocker of a beginning to the year.
The January 2021 margin comes in at a loss of $310 per head, according to the theoretical model. This is the lowest recorded monthly margin since records began in early 2000. It’s never a good thing for a supply chain to have a key participant suffering financially and it makes it difficult to see how finished cattle prices can continue to push higher during 2021.