Cattle prices to soar but steaks shouldn't cost more

Meat lovers hoping to see an end to high beef prices might have to get used to the already eye-watering cost of a mouth-watering steak.

Experts say the only way is up for saleyard prices over the next two years as farmers rebuild herds following drought. Although that might not necessarily mean things will get any worse for consumers, they aren't likely to improve either. 

“When you hold back females because you're trying to build the herd it means even less meat in the pipeline and therefore prices move even higher,” says Simon Quilty from market analytics firm Global AgriTrends.

“I'm of the opinion that within two years cattle prices will be double what they are today.”

Analysts at ABARES, the economics research division of the federal agriculture department, forecasts prices will rise about 24 per cent in 2024/25, followed by similar increases the following year.

While not by as much, live lamb prices are also set to rise.

Yet it's not all bad news, with consumers unlikely to bear the additional brunt.

Braised prime short rib of beef (file)
While steak lovers might not have to pay more for their favourite fare, they won't be paying less.

Mr Quilty says supermarkets will shoulder most of the increase because they’re already charging premium prices in anticipation of market changes. 

“People say consumers won't be able to pay for the lifting cattle prices … My answer to that is bullsh***. They're already paying it today, they just don't realise it,” he says. 

He predicts retail prices will remain steady, with a mild increase possible over the next two to three years. 

Red meat marketing body Meat and Livestock Australia says that historically, it takes about eight months for cattle and sheep prices to filter through to the supermarket shelf.

Tim Ryan from the Australian Meat Industry Council, which represents butchers and meat processors, warns livestock prices can be difficult to predict due to uncertainties about the weather and export markets. 

However, he says retailers plan ahead to limit volatility. 

“They don't want to suddenly change price on the consumers all the time. They want to give them a level of certainty,” he says.

Meat on display in a Woolworths supermarket
Supermarket meat prices are expected to increase mildly over the next two or three years.

Coles and Woolworths have reduced what they're charging for a selection of meat products this year. 

However Nationals leader David Littleproud MP says the retail giants should be doing more to narrow the gap between what farmers are paid for their animals and what consumers shell out for meat at the checkout.

The Queensland MP, who worked as an agribusiness banker before being elected to parliament in 2016, claims lamb and cattle prices have plummeted since 2022, yet “families at the supermarkets have barely noticed a difference in prices”.

MLA data shows that between January 2022 and January 2024, the sale yard price of a heavy steer, young male cattle that typically ends up as beef on the supermarket shelf, halved from about $4.30 per kilo to $2.15 per kilo. 

The saleyard price of a lamb fell from about $8 per kilo to $6 per kilo over the same period. 

According to the MLA, supermarket beef prices rose about five per cent over the same period, while lamb prices remained steady.

Saleyard cattle and lamb prices began to rebound in the first quarter of 2024 but are still far off their late-2021 highs. 

Multiple domestic and international factors influence livestock prices. 

Seasonal weather has a major influence on farmers' decisions about how many animals to keep or sell in a single year. 

Harsh conditions like droughts incentivise them to offload livestock, including sending more animals to slaughter. When droughts occur across a large geographical area, increased meat supplies put downward pressure on prices.  

Conversely, farmers want to restock their fields when conditions are expected to improve. This boosts demand for live animals, particularly breeding stock, and pushes prices back up. 

Beef and lamb prices are also dependent on export demand, which accounts for around 70 per cent of Australian beef production and 60 per cent of Australian lamb.

Industry figures also say labour shortages at Australian meat processing facilities since COVID-19 caused a supply bottleneck that distorted the market.

Bale feeding cattle during drought (file)
Drought can increase meat supplies as farmers go to market, and put downward pressure on prices.

 “Number one priority when I speak to our members is people, and a key component of that is the overseas workforce,” Mr Ryan says. 

“So programs like the PALM scheme (for Pacific islanders) have become incredibly important to processing centres to keep those plants operating.”

The government announced in January that the Australian Competition and Consumer Commission (ACCC) will conduct an inquiry into supermarket prices, including examining the gap between farmgate and retail prices.

An ACCC inquiry into meat prices in 2006 found the price of a live steer accounted for 53 per cent of the retail price of beef. 

Processing costs such as killing, boning and refrigerating a steer comprised 14 per cent of the price consumers paid. 

Retailing costs, such as packaging, advertising and selling, accounted for about 30 per cent of the final shelf price.

Coles says the price of its meat is not determined solely by the market price of livestock but also supply chain costs like transport, processing, packaging and selling. 

“We know cost of living is front of mind for many Australians and we are committed to providing high-quality meat at lower prices,” a Coles spokeswoman told AAP.

License this article

What is AAPNews?

For the first time, Australian Associated Press is delivering news straight to the consumer.

No ads. No spin. News straight-up.

Not only do you get to enjoy high-quality news delivered straight to your desktop or device, you do so in the knowledge you are supporting media diversity in Australia.

AAP Is Australia’s only independent newswire service, free from political and commercial influence, producing fact-based public interest journalism across a range of topics including politics, courts, sport, finance and entertainment.

What is AAPNews?
The Morning Wire

Wake up to AAPNews’ morning news bulletin delivered straight to your inbox or mobile device, bringing you up to speed with all that has happened overnight at home and abroad, as well as setting you up what the day has in store.

AAPNews Morning Wire
AAPNews Breaking News
Breaking News

Be the first to know when major breaking news happens.

Notifications will be sent to your device whenever a big story breaks, ensuring you are never in the dark when the talking points happen.

Focused Content

Enjoy the best of AAP’s specialised Topics in Focus. AAP has reporters dedicated to bringing you hard news and feature content across a range of specialised topics including Environment, Agriculture, Future Economies, Arts and Refugee Issues.

AAPNews Focussed Content
Subscription Plans

Choose the plan that best fits your needs. AAPNews offers two basic subscriptions, all billed monthly.

Once you sign up, you will have seven days to test out the service before being billed.

AAPNews Full Access Plan
Full Access
  • Enjoy all that AAPNews has to offer
  • Access to breaking news notifications and bulletins
  • Includes access to all AAPNews’ specialised topics
Join Now
AAPNews Student Access Plan
Student Access
  • Gain access via a verified student email account
  • Enjoy all the benefits of the ‘Full Access’ plan at a reduced rate
  • Subscription renews each month
Join Now
AAPNews Annual Access Plan
Annual Access
  • All the benefits of the 'Full Access' subscription at a discounted rate
  • Subscription automatically renews after 12 months
Join Now

AAPNews also offers enterprise deals for businesses so you can provide an AAPNews account for your team, organisation or customers. Click here to contact AAP to sign-up your business today.

Download the app
Download AAPNews on the App StoreDownload AAPNews on the Google Play Store