Mecardo Blog

Robert Herrmann

Robert Herrmann
Rob is the Managing Director of Ag Concepts Unlimited, an independent specialist agricultural advisory service and publisher of Mecardo. Mecardo provides the latest market analysis and outlook for cattle, sheep, wool and grain markets. Rob has over 30 years of agricultural experience, including 11 years as a senior wool specialist with Elders advising in the marketing and risk management of agricultural commodities.
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Recent Posts

How to deal with animal activists: A lesson from the egg industry

Posted by Robert Herrmann on 20 April 2016

The egg industry is a good example in how to deal with Animal Activists, and perhaps it can provide some ideas for the Australian wool industry around how to respond to the mulesing debate.

The production of cage eggs and the subject of mulesing have been easy targets for the radical activists, however the end result to each industry is starkly different.

When producers are asked, both industries are adamant that their practices (cages and mulesing) are not only humane, but actually improve the welfare of the bird/sheep.

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Topics: Wool industry, Australian wool industry, animal rights

The enemy of my enemy is my friend

Posted by Robert Herrmann on 16 March 2016

The AMIEU acting in the interests of its members comes as no shock – but when they act in the interests of the meat processors we are bemused. Throw in supporting comments from the Animal Activists and you could be excused from thinking the world has gone mad. The ancient proverb 'the enemy of my enemy is my friend' could well have been mused with this relationship in mind!

The take away message when you look at the recent press releases from the AMIEU regarding the threat to processing jobs from the Live Export (LE) trade is that the 1.4 million cattle exported last year have the potential to ruin cattle producers, processors and destroy the AMIEU member’s jobs.  I was hoping to read that it was also the cause of Donald Trump’s hair-do but unfortunately no mention.
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Topics: Cattle market / cattle price, live export

Australian wool industry - is it all doom and gloom?

Posted by Robert Herrmann on 10 December 2015

In his iconic 1975 song “Slip sliding away”, Paul Simon most certainly wasn’t talking about the merino sheep industry. However, the lyrics could easily relate to the direction that flock numbers and wool production has taken, especially since the 1990s.

Analysis: Has Merino wool production stopped falling?

In fact, this trend isn’t confined to Australia: the number of sheep worldwide have also fallen over this period.

Usually, the cause of such a decline would be readily understood: low prices, diminished demand, or a combination of the two are the usual culprits.

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Topics: Wool market / wool price, Flock size, Wool industry

Grain Swaps - farmers' friend or hazard to be avoided?

Posted by Robert Herrmann on 23 November 2015
  • “I won’t use swaps because if the market goes up I will lose”

  • “I have heard of a wheat farmer who lost his farm as a result of taking a Grain Swap”

  • “The bank always wins; they know more about the market than we do”

  • “With swaps, someone always wins and someone always loses”

Sound familiar?

These are just some of the statements we have heard from farmers when the issue of swaps is raised.

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Topics: Risk management, Grain market / grain price

Record female cattle slaughter to be felt for years to come

Posted by Robert Herrmann on 26 October 2015

“If the current rate of female cattle slaughter is maintained, there will be no cattle left in seven years’ time.” 

Alarming? Definitely.  Realistic?  Probably not.  But in saying this, Mecardo analyst Angus Brown was highlighting the point that the female cattle slaughter, at its current levels, cannot be sustained without significant impact.

Watch short video

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Topics: Australian cattle industry

Where will the wool industry be in 25 years?

Posted by Robert Herrmann on 7 October 2015

Undoubtedly, my career is almost entirely connected one way or the other to the Australian wool industry. However, it’s a sad indictment that, over this time, it has steadily declined in production.

From a peak in the late 1980s of 175 million sheep to the current flock size of 70 million (figure 1), it is hard not to arrive at the conclusion that this decline resembles a disaster for the wool industry. The bottom line is that farmers have ‘voted with their sheep’ to exit wool production and get into the business of growing food – be that grains or meat.

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Topics: Flock size, Australian wool industry

Magical 600¢ barrier within striking distance!

Posted by Robert Herrmann on 21 September 2015

We were nuts, they said. Cattle prices at 600¢? Yet, despite the 20% increase last week in eastern states young cattle yardings, the Eastern Young Cattle Indicator (EYCI) recovery continued to gather momentum to see the indicator move closer to the 600¢/kg cwt mark.

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Topics: Cattle market / cattle price

Sheep numbers down, outlook up, up?

Posted by Robert Herrmann on 16 July 2015

Sheep meat demand has a rosy forecast, while wool is also showing optimism after a period of struggle. On the supply side, world sheep numbers from the major wool and meat producing countries since 1990 have fallen, with falls ranging from 67% in Uruguay to just 3% in South Africa.When looking at the market outlook for any commodity, but especially agricultural commodities; taking account of projected supply & demand and assessing price risk is a good starting point.

This then leaves the question of market risk.

"High prices correct high prices"

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Topics: Sheepmeat market, Wool market / wool price, Flock size

Good times ahead for cattle market...but not all will benefit

Posted by Robert Herrmann on 2 June 2015

There have been a number of important stories relating to the Australian cattle market over the past year. Increasing prices finally coming through on the back of record export beef prices, high slaughter numbers providing the opportunity for processors to make good profits, and the seasonal conditions (rainfall is always a talking point in farming!) have all formed a significant part of discussions.

The high slaughter numbers coming forward in recent months may have been influenced by the rising cattle market, but there is no doubt that the major influence over the past 2-3 years has been the poor season.

But this only tells part of the story; each year the number of male steers sold is relatively constant; you can only sell the number of male calves born each year.

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Topics: Cattle market / cattle price

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