Australian cattle prices have hit record high levels due to increasing demand in US and Asian markets, AHDB, the organisation of the English beef and sheep industry, says.
The Eastern Young Cattle Indicator (EYCI), the benchmark of Australian cattle prices, broke through the €5.00c/kg threshold for the first time in mid-June, AHDB says.
It says that prices have continued to increase on a daily basis and reach €075.20c/kg on June 29.
Drought in the US has had a significant impact on its beef and veal production which, in turn, has dramatically lifted demand for Australian beef, AHDB says.
Smaller herd sizes as a result of persistent drought in cattle-producing areas of northern Australia, has meant that less cattle are being made available for market, it says.
According to AHDB, many beef producers in the drought-affected states have had to cull their livestock, while others have been unable to put their cows into calf.
Both these factors, combined with the depreciation of the Australian Dollar which has made exports more competitive, have driven the relentless upwards pressure on farmgate prices, it says.
The Australian Dollar is much weaker now compared to where it was a year ago, and even weaker compared with two or three years ago, it says.
Looking ahead, AHDB says that the widely held expectation that the EYCI could reach 6.00c/kg before the end of the year looks very possible.
A considerable tightening of beef supplies in the rest of 2015 and exports falling in line with production levels, has been forecast by Meat and Livestock Australia (MLA), AHDB says.
Australian producers with cattle left to sell look set to be in a position to benefit from the supply/demand imbalance, it says.
