NSW Beef Enterprises See Improved Returns Amid Rising Cattle Prices

Recent beef gross margin budget calculations indicate that returns from New South Wales beef enterprises have generally improved since October 2024, largely attributed to rising cattle prices and a robust performance in the feedlot sector.

Overview of Recent Profitability Analysis

According to the latest analysis from the NSW Department of Primary Industries and Regional Development (NSW DPIRD), most enterprises are experiencing increased returns. However, some coastal operations are facing severe challenges due to flooding and rising animal health costs.

Specifically, returns from inland weaner production saw a slight increase, rising from $39.79 per Dry Sheep Equivalent (DSE) to $42.07/DSE. In contrast, coastal weaner production on improved pastures experienced a decline, dropping from $41.83/DSE to $38.11/DSE.

Furthermore, returns for producing feeder steers through a self-replacing herd increased significantly, from $52.14/DSE to $58.76/DSE. Gross margins from growing purchased weaner steers to feedlot weights also surged from $41.41/DSE to $69.46/DSE.

Insights from Industry Experts

Todd Andrews, Beef Development Officer at NSW DPIRD, commented on the encouraging trend: “Despite some cost pressures, the uplift in cattle prices, particularly for Angus feeder steers and weaners, has strengthened returns across key beef enterprises.”

He added, “Angus feeder steer prices have risen approximately 17%, pushing up steer weaner prices as producers seek weaners for backgrounding operations. Meanwhile, weaner heifer prices have remained stable as the demand for females has eased.”

“The only sector experiencing a decline in gross margins is coastal weaner production, impacted by a mild autumn leading to a higher stock availability and subsequent price adjustments for off-type or flood-affected animals.”

Growth in the Australian Feedlot Sector

The Australian feedlot sector is also witnessing notable expansion, with a record 1.5 million cattle currently on feed. This growth can be attributed to both global and domestic factors, as Australian feedlots compensate for the reduced supply of grain-fed beef from the U.S.

“Producers who are able to finish cattle on pasture and meet program requirements may still achieve premium prices, especially for crossbred weaner heifers currently trading at a discount,” Andrews remarked.

Looking forward, he noted that fertilizer prices are increasingly volatile due to fluctuating supply pressures, while transport costs have recently stabilized, providing some relief for trading enterprises.

“With a positive seasonal outlook heading into spring, producers who can manage costs effectively and adapt their strategies will be well-positioned to make the most of these favorable trading conditions moving forward,” he concluded.

For more information, view the complete list of Beef Gross Margin Budgets for 2025 and prior years.