November was the worst month for meat processors’ profit margins in about 25 years.

Key points:

  • Three quarters of meat processors operating at 80 per cent or less production
  • Processors could consider cutting shifts amid high cattle prices
  • AMIC CEO says November was the worst trading month in about 25 years for abattoirs. 

Australian Meat Industry Council CEO Patrick Hutchinson said high prices, a lack of labour, and low stock numbers were taking their toll on the processing industry.

He said while many producers are enjoying the high prices, he warned something had to give eventually.

“Currently, for cattle, we’re losing about $350 per beast processed. We’re keeping our heads above water, but this can’t go on forever,” he said. 

Mr Hutchinson said abattoirs might have to cut shifts or even go on hiatus until prices for livestock come down. 

“Three-quarters of processing in this country is running at 80 per cent or less capacity,” he said. 

“We don’t have enough people to manage our workload at the moment, let alone when more livestock come on the market. Also, we have a logistical nightmare with international shipping and port disruptions.

The Eastern Young Cattle Indicator  (EYCI)  is a seven-day average of the prices of cattle across 23 saleyards across Australia and is used as an indication of the price of cattle. 

Earlier this year, the EYCI breached its 900 cents per kilogram of carcase weight record and now sits at more than 1,100 cents. 

This is why most Australian abattoirs are only at 80 per cent capacity
Source:
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