Market Morsel: Rebuild again

Market Morsel

Australian Bureau of Statistics cattle slaughter data for the September quarter signals a move back to herd rebuild as the female slaughter ratio (FSR) eases from 47.5% in the June quarter to 44.4% for quarter three of 2021.

Historically, an FSR under 47% generally indicates that the herd is in a rebuild phase. The decline in the FSR during the September quarter brings the annual average FSR to 45.8%. The last time the FSR was this low was at 45.5% during 2017 when the herd increased by 5.6%.

Meat and Livestock Australia are forecasting an increase of 7.1% in the Australian herd during 2021. The last time the herd grew by a similar magnitude was back in 2011, when a gain of 7.4% was noted in the Australian cattle herd. During 2011 the FSR averaged 43%, so we will need to see the ratio remain in the low 40% region, or lower, in the final quarter of 2021 to keep up the momentum of the rebuild.