Selling options for beef cattle

Department of Agriculture and Fisheries - Roger Sneath

Type: Article
Knowledge level: Intermediate

Farm Table says:

Weigh up the best selling method for your beef cattle!

This article aimed to provide the available selling options for beef cattle from paddock sales through to online auction systems, weighing up the pros and cons of all methods and their associated fees.

The selling methods covered in this article were:

  • Saleyard auctions
  • Auctions Plus
  • Over the hook sales
  • Forward contracts
  • Paddock sales
  • Alliances

Key points were as follows:

  1. Paddock sales have the lowest selling cost to the vendor as the purchaser organises transport direct from the farm gate.
  2. Saleyard auctions are a higher risk selling option due to market fluctuations, competition on the day and associated transport and selling costs incurred by the vendor.
  3. Over the hook sales are most advantageous to vendors who may have visually defective cattle. This sale method is lower in associated sale costs and carcase feedback is provided.
  4. Auctions Plus sales reach an Australian wide market and reserves are set in advance by the vendor. It is a lower risk selling method as cattle don’t leave the property until they are sold with only moderate associated selling costs.
  5. Forward contracts carry high risk if the producer cannot be certain of meeting contractual obligations. If herd certainty can be controlled, many benefits can be gained from this selling method.
  6. Alliances are beneficial when production is consistent as the producer is receiving a consistent cash flow. Difficulties with alliances exist during market fluctuations or with poor herd control.

This article concludes that selling options for beef cattle all have pros and cons; it greatly depends on the type and scale of beef cattle operation you operate that determines the best way to market your livestock to get you the best return.

2011 - Australia - Department of Agriculture and Fisheries - Roger Sneath
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