Beef prices poised to surge on back of high grain prices, empty feedlots

Consumers face paying up to 20 per cent more for beef as spiralling grain prices and low margins force farmers away from expensive cattle feeding regimes, leaving many of the nation's feedlots empty.

The number of cattle in feedlots nationally has fallen 35 per cent from the same time last year, with WA numbers halved to just 28,000 head.

Grain-fed cattle for the WA market usually spend three months in the feedlot, with the downturn expected to result in autumn and winter supply shortages when seasonal supplies of grass-fed cattle are replaced with lotfed animals.

WA Independent Grocers Association president John Cummings said shoppers would have to look at a price increase in the realm of 12 to 20 per cent within the next year.

He said this would mean an extra $2 for a T-bone steak or an increase in low fat mince from about $12/kg to $14/kg. Mr Cummings said retailers were bracing for a further tightening of primary produce supplies ranging from beef and pork to cheese caused by a combination of the drought and spiralling animal feed costs.

"The reports coming through for a retailer are quite frightening," he said. "We are nervous about continual future supplies of high-grade product." The State's biggest processor, Harvey Beef, will pay about 6 per cent more for grain-fed cattle for the domestic market under contract arrangements from March.