Rising Demand for Agistment Amidst Drought in Southern Australia

Demand for agistment is surging due to ongoing drought conditions affecting large parts of southern Australia, coupled with changing business models among producers, according to industry experts.

Increased Agistment Activity

Recent weeks have seen a notable increase in agistment activity, particularly as southern cattle are being transported north. Some of these cattle are vendor-owned, while others have recently changed hands, with new owners aiming to capitalize on favorable trade conditions after agisting further north. A parade of empty trucks traversing the New England and Newell Highways this week highlighted this trend, as observed by Elders analyst Richard Koch.

Primary Drivers of Demand

According to Chris Howie, CEO of RMA Network and regular commentator for Beef Central, there are three main factors fueling the rising demand for agistment in response to seasonal pressures in the southern regions:

• Producers attempting to maintain their core breeding herds amid a lack of feed or water.
• Farmers moving preg-tested cows or heifers north for calving, anticipating a closer market for the offspring.
• Producers looking to increase weight on light weaners, facilitating their journey toward the end-user market.

Connecting Producers with Available Paddocks

In 2012, Sarah Birchmore and her husband David launched agistment.net.au. This platform arose from their own struggles to find suitable agistment for their cattle north of Winton, Queensland. Birchmore reported a surge in inquiries for agistment, particularly from southern producers with higher stocking rates.

Demand vs. Availability

Despite the preference for keeping cattle nearby to minimize transport and monitoring costs, the current conditions are forcing producers to look further away for suitable paddocks. Birchmore noted:

“There’s a lot of demand for agistment in northern New South Wales, but the demand is definitely outweighing what’s available.”

Agistment Pricing Trends

Birchmore observed that available paddocks are filling rapidly, typically within a week or ten days, provided the pricing is reasonable. Prices for agistment are currently:

• $5 to $7 per week for weaners.
• $8 to $10 per week for cows and calves, with adjustments based on expected weight gain and the quality of pasture.

Ensuring Feed Integrity

Both Birchmore and Howie emphasized the importance of maintaining the quality of feed. Howie warned that mixing other livestock, such as sheep, with cattle can jeopardize feed availability and integrity.

Financial Considerations of Agistment

Agribusiness advisor Ian McLean, managing director of Bush Agribusiness, pointed out the potential financial risks associated with agistment. He encouraged producers to conduct thorough calculations before committing cattle to another property:

“The costs of an unplanned muster and move to new agistment or forced early sale can wipe out the margins on the agistment.”

McLean recommended using tools like HerdXL’s Trader to explore various performance scenarios while also advising caution regarding pasture budgeting and planning timelines for agistment.

Agistment Opportunities for the Next Generation

Birchmore highlighted that agistment allows newcomers to the cattle industry to enter without the need for land ownership. This flexibility enables individuals to maintain smaller herds while working elsewhere, providing a viable pathway into agriculture without the financial burden of land acquisition.

“It gives them a foot in the door without the pressure of having to own land,” Birchmore concluded.