Latest cattle market update

Read the latest insights and information on the Australian cattle market for February 2026*.

Lower US beef production will underpin solid export demand for Australian beef over the medium term, however, China’s announcement that it would impose beef import restrictions will lead to a change the competition landscape in 2026.

China will restrict annual beef imports to 2.8mt through country specific quotas with above quota imports subject to a 55 per cent tariff. The major consequence will be to limit exports from its major suppliers Australia (quota of 206,000t vs exports of around 300,000t) and Brazil (quota of 1.1mt vs exports of 1.7mt). Around 100,000t of Australian beef and 600,000t of Brazilian beef previously ear marked for the Chinese market will need to be diverted to other markets. 

Australian chilled beef exports displaced from the Chinese market should be readily diverted to alternative markets without too much consequence (see heavy steer comment), given opportunities created by lower US fed beef production in 2026.

The largest impact of China’s beef import restrictions will come from changes in Brazilian beef export flows. Increased Chinese imports of Brazilian beef have shielded Australian exporters from the impact of rising Brazilian beef production over the past five years. Chinese restrictions on Brazilian beef imports are likely to accelerate their efforts to diversify beef exports (mostly lean frozen manufacturing beef) and significantly increase Brazilian competition in commodity beef markets in 2026 and onwards.

Brazil is close to implementing a quota management system that would restrict monthly exports to China to 80,000 tonnes. This would leave Brazil having to find new alternative markets for up to 60,000 tonnes of beef each month. Australia would likely feel the impacts of increased Brazilian competition in non-Chinese markets as soon as Chinese restrictions become effective. Although discussions have taken place about the merits of Australia implementing a self-imposed quota management system, it is unlikely that this will be in place in 2026.

In contrast to last year, when the Australian beef and cattle industry had supportive headwinds courtesy of favourable trade policy developments (US beef locked out of China and the US imposing a prohibitive tariff on Brazilian beef imports), the competitive landscape in 2026 has changed. US beef is likely to regain access to the Chinese market mid-year while Brazilian competition is likely to intensify in markets outside China. A significantly higher Australian dollar will add to our export market challenges in 2026. 

What might develop is a two-speed export market where higher quality chilled beef values rise (driven by opportunities for Australian chilled exports arising from lower US fed beef production) but beef values fall in commodity or manufacturing beef markets (frozen manufacturing beef) where Brazilian beef exports have access. 

How will this manifest in Australian cattle markets in 2026? Feeders and finished steers targeted at high quality grain and grassfed chilled programs should hold relatively firm but cows and secondary steers destined for global commodity beef markets will come under pressure.

Lower US fed beef production to underpin Australian heavy steer values

Underpinning firm demand for slaughter ready heavy steers through 2026 will be the decline in cattle on feed in the US. The US is our major competitor in global chilled high quality beef markets.

The January USDA Cattle on Feed report reveals a sharp decline in US feedlot inventories to 11.45 million head down 3.2 per cent year over year, the 14th consecutive month of declining feedlot inventories and the lowest levels since 2018. 

December feedlot placements were down 5.4 pc from a year ago, the ninth consecutive month of lower placements. Lower calf numbers (US beef cow herd shrunk another 1 pc in 2025) and the ongoing ban on Mexican feeder cattle due to the New World Screwworm ban have limited cattle on feed placements and will limit US fed cattle slaughter well into 2027.

US feedlot marketings in December were higher than last year, up 1.8 pc year over year, following an 11.9 pc drop in November. This is the first increase in monthly marketings in eight months. US feedlots have been managing declining placements by holding cattle in feedlots longer. Despite declining overall numbers, US feedlots are front loaded with cattle (cattle on feed +150 days are 25 pc higher than last year). This has contributed to a sharp 7 pc lift in average carcase weights (increased from 840lbs to peak at 900lbs in December) through 2025 which has partly offset the impact of lower US cattle slaughter on fed beef production.

US beef production fell by 3.6 pc in 2025 and based on lower cattle inventories. A similar decline is expected this year, although currently the USDA is only suggesting a 1 pc fall. US choice beef cut-out values are currently 11 pc higher than last year and, despite concerns over weak US consumer sentiment and beef being expensive compared to white meat protein, US beef demand shows no sign of weakening.

Lower US grain-fed beef production is creating opportunities for Australian exporters – Australian chilled beef exports rose 16 pc in 2025 with the major contributors to growth exports to the US, China and the UK.

Further supporting Australian finished cattle values are the mixed seasonal conditions across southern Australia which is contributing to the tight supply of heavy weight slaughter ready cattle in the south.

Manufacturing beef markets firm as exporters target China

Prices for both domestic US and imported lean beef in USD have remained firm in USD terms entering 2026 as US end users struggled to source supplies. Strong demand from China continues to impact trade with seasonally lower offerings from Oceania focused on satisfying Chinese demand ahead of the imposition of Chinese import restrictions. 

However, while demand for imported beef remains firm, the higher Australian dollar has crimped returns for Australian exporters (90CL cow beef into the US has fallen 4 pc or 50Ac/kg to 1150Ac/kg in January) which has compressed processing margins, limiting the amount processors are willing to pay for suitable stock. Local cow values have fallen in line with export returns to be 370c/kg liveweight (lw) in saleyards or 730 to 790c/kg dw (dressed weight) in over the hooks markets, down 20c/kg lw or 40 to 50c/kg dw. 

Complicating manufacturing beef trade dynamics will be the likely presence of increased supplies of frozen Brazilian beef. Recently Indonesia has authorised another 14 Brazilian plants to export to Indonesia bringing the total to 52.

Brazil is well progressed in obtaining access to the Japanese and Philippine markets and will likely play a much larger role in the US imported beef market once Chinese import restrictions become effective. With food affordability such a widespread economic issue, conditions are ripe for Brazil to obtain improved export market access.

Increased Brazilian competition in Australia’s traditional manufacturing beef markets will pressure manufacturing beef prices throughout 2026 and will limit prices processors can pay for cows and other stock suited to manufacturing beef markets.

Australian dollar & Brazilian competition to create headwinds in commodity beef markets

Feeder prices stabilise as final run of northern cattle hit market

Tightening seasonal conditions and very hot weather from Tambo across to Rockhampton in Queensland and all the way to South Australia has taken a toll on the feeder cattle market, which has adopted a more cautious tone in the past couple of weeks. A lift in supply as operations moved back into full swing after Christmas/New Year period and a sharp lift in the Australian dollar combined with news of the Chinese import restrictions have seen feeders take stock.

Some have cautioned that the market is only a good rain away from firming again with longer-term demand dynamics in favour of strong demand for grain-fed beef and hence feeder cattle demand (see above discussion around falling numbers of US cattle on feed).

Feedlot buyers were quoting +400kg flatback feeder steers on the Darling Downs between 475 to 495c/kg lw – about 20c/kg lw less than pre-Christmas rates.

Southern Angus feeder prices have taken a 20 to 30c/kg lw hit in the past fortnight, with feeder steers quoted between 470 to 490c/kg lw while southern crossbred steers (no indicus) were being quoted about 460c/kg lw. 

Saleyard rates have held up better with the national saleyard indicator around 470c/kg lw and just below its year high of 490c/kg in November.

China’s beef import restrictions are still causing some uncertainty in the feeder market, with feedlot operators adopting different strategies. Several mid-fed Angus programs have been ditched, and many have dropped their premiums for HGP-free cattle.

The uncertainty associated with the Chinese market has encouraged yard operators to pursue EU-accredited feeder cattle to target European markets. Premiums for EU accredited feeder steers above Angus have increased to 20c/kg lw since the China announcement.

There has been some discussion between Australian exporters and Chinese importers about sharing the burden of the above quota tariff, presumably on cattle locked into long feeding programs and likely to exit feedlots and enter China after mid-year when the quota tariff is likely to be triggered.

Feeder rates under pressure

Restocker confidence solid, but tentative

A review of the southern weaner sales provides a good insight into the state of restocker demand. Weaner weights were up by 15 to 20kg after a good late spring which followed a tough autumn and winter. 

Steers across all weight ranges made from $5 to $6/kg lw with a tight spread of pricing across breeds and weight ranges. The was little in distinct breed-based price variance with Hereford and British X cattle all selling well to be the equivalent or only 10 to 15c/kg lw less than straight Angus. Weaned EU accredited steers were keenly sought by processors, feedlots and bullock fatteners and generally sold to +20c/kg lw premium over other cattle types.

In contrast to last year, a good proportion of the southern weaner offering sold to local backgrounders (Gippsland, the Western District of Victoria and south-east SA) hoping to take advantage of the turnaround in the season. Northern buyers were active in sales around the NSW/Victorian border, but freight costs prevented Queensland orders from getting a look in further south.

Heifers performed well and sold much closer to steers than they did last year with somewhere between $4.50 to $4.70/kg lw paid to buy decent runs.

In the past few weeks, restocker cattle markets have lost momentum as the weaner sales wrapped up and as conditions turned progressively hotter and dryer.

Restocker markets lose momentum

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The information contained in this article is given for general information purposes only, current at the time of first publication, and does not constitute professional advice.  The article has been independently created by a human author using some degree of creativity through consultation with various third-party sources.  Third party information has been sourced from means which Elders consider to be reliable.  However, Elders has not independently verified the information and cannot guarantee its accuracy.  Links or references to third party sources are provided for convenience only and do not constitute endorsement of material by third parties or any associated product or service offering.  While Elders has exercised reasonable care, skill and diligence in preparation of this article, many factors including environmental/seasonal factors and market conditions can impact its accuracy and currency.  The information should not be relied upon under any circumstances and, to the extent permitted by law, Elders disclaim liability for any loss or damage arising out of any reliance upon the information contained in this article.  If you would like to speak to someone for tailored advice specific to your circumstances relating to any of the matters referred to in this article, please contact Elders.