Research

Managing increased volatility in Australian livestock markets

15 October 2025 11:15 RaboResearch

Australian livestock markets are facing heightened volatility. This report explores the causes and offers insights to help producers respond strategically.

Intro

    Australian livestock markets have become increasingly volatile over the last 25 years. Price movement in the Australian feeder steer market moved from a AUc 47/kg variation between the high and low point during 2000-2004 to a AUD 3.69/kg variation in 2020-2024. This is a 31% difference between low and high in 2000-2004 compared to a 180% difference in 2020-2024. The increased volatility in the Australian livestock markets is not common across other markets, suggesting there are particular factors affecting Australian livestock markets which lead to this increased volatility. In considering the causes of increasing volatility, it is recognised that Australian livestock markets have more recently been exposed to geographically larger markets, increasing flows of information, geopolitics, a changing industry structure and increasing debt levels. All of which we believe contribute to increased volatility. Seasonal conditions and producer perceptions have a very strong influence on market direction but do not provide a good indication for the size of market movement. Volatility is not inherently negative it simply represents risk, and potentially opportunities. We believe that current levels of volatility are likely to persist in the Australian livestock sectors for the short to medium term and industry participants should at least prepare to manage volatility. This requires a strategic approach that reinforces adaptability, promotes resilience and improves predictability.

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