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Local saleyard supply firing as Brazilian tariff reduction creates meat market instability

By: Ripley Atkinson, Ripley Atkinson

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Local saleyard supply firing as Brazilian tariff reduction creates meat market instability

Key Points

  • US Administration dropping 40% tariff on Brazilian beef exports will create further volatility in Australian cow prices – loads booked this week have reflected that shift.
  • Saleyard supply extremely strong at present with a number of yards seeing their highest throughput in many years.
  • Driven by higher supply and dry conditions beginning to set in – the market is somewhat uneasy at present.

US Administration drops Brazilian 40% Tarriff

  • Less than 9 hours after I recorded the podcast last Thurday, discussing how the potential shift in Brazil tariffs were more important than our reduction from 10% - the US Administration announced it was removing the remaining 40% rate from Brazilian beef imports.
    • Out of Quota rate of 26.4% remains for product landed within the next 6 weeks before 2025 ends. Expect the Other country out of Quota rate to be filled by Brazil within a matter of days in January 2026.
  • This brings the marketplace back in line to how it was operating prior to Trumps Brazilian tariff change announcement on August 6
  • Imported Trim markets have reacted swiftly to this news – business now being done a fair bit cheaper this week than what it was being booked at, as recently as mid last week.
  • On the US local front – see chart below, the Jan-26 CME Feeder Futures price is down 17% or 65c/lb since its highs for the contract set on 16 October – that fall translates to A$2.19/kg lwt based on spot AUD / US FX

 

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Supply

  • Cow supply as expected has picked up over the past week or two- despite this and the impending adjustment to trim values underpinned by the announcement regarding Brazilian tariff reductions the market has held flat (ish) this week.
  • I mentioned a few weeks ago – that clearing the decks mentality would likely see strong volumes pushed into markets before Christmas – that scenario has well and truly played out – 3 weeks in a row with well above average saleyard yardings a good indicator of this.
  • Saleyard throughput this week across a number of selling centres hit highs:
    • Tamworth – highest since March 2019 and second highest on record
    • Scone – highest since 2018
    • Dalby – highest since 2003
    • Dubbo backed up last week with another very large yarding 
  • Based on November to date weekly export data, we have now broken the 2024 calendar year beef export record, and shipped 1.366 million tonnes and have 6 weeks remaining in the calendar year. We’re well on track to export over 1.50 million mt for 2025.
    • Exports current as at 23rd November 2025

Demand

  • I sense some unease in this market at present – I feel as if its somewhat second guessing itself – heavier supplier can do that but the discussion around dry weather is beginning to take shape and I feel that uncertainty on season is now playing into this unease.
  • The weight of numbers in the yards this week has weighed on pricing somewhat, but I’d argue demand overall has remained solid throughout the yards – prices have performed admirably.
    • Openly admitting that the saleyard data only tells about 20% of the story of cattle pricing.
  • Moving into 2026 – with drier weather looking likely to develop – cattle with weight and condition in northern markets (north of Dubbo) will be in very strong demand.
  • The health of the beef industry in QLD, underpinned by a really solid 2025 in financial terms will provide strong support for the sector into 2026.
  • Demand in the south and premiums for heavier, finished cows is very strong at present.

Price

  • Markets firm this week through the yards and generally the same results across direct grids.
  • Cow price volatility should heat up as the market comes to terms with the reduction of the Brazilian tariff to 0% - downside in the processor cow markets at both saleyard / direct pricing can be expected when these signals pull through to livestock.
  • I sense next week we could see some downside to this market – just has that feel about it at the minute.
  •  

Weather

  • Western Riverina getting pretty dry, west of Wagga down to the Hay Plains stretching well into Central & northern NSW / southern QLD chats with the market have indicated to me this week. A continuation of the below to be expected when November decile data released next week.
  • image-20251128090044-2
  • Good falls again this week across the east, particularly regions hugging the Great Dividing range, inland of it also received good falls.
  • Further rains expected for the far north over the next week – Cape York into the Gulf and across into the Kimberley’s – good early storms setting the north up solidly!

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