FMD risk starting to weigh heavily on listed companies exposed to livestock
Beef Central (Australia)
SHAREHOLDERS investing in some of Australia’s largest listed companies exposed to our livestock industries are responding to the elevated level of concern over Foot & Mouth Disease risk.
Both Elders and the Australian Agricultural Co share prices have fallen over the past three weeks, as FMD concerns have risen, and analysts have connected the two.
As this graph shows, Elders’ share price closed yesterday at $11.75, having started July at $12.75, a drop of 9.27pc.
Similarly, AA Co shares have fallen 11.85pc over the past month, finishing yesterday at $1.86, down from $2.11 back on 4 July.
Whether it be coincidental or otherwise, both reflect the broader store and slaughter cattle price trend seen since the start of July. Also see today’s weekly kill report.
Over a two-month cycle since late May, Elders shares have now fallen around 16pc – despite the strong trading updates released earlier this year – compared with the Eastern Young Cattle Indicator, which has dropped 21pc over the same period.
In private discussions, Beef Central understands that major finance providers to the agriculture industry have all sought briefings on the FMD risk scenario this week from government and industry authorities.
Analysts are now clearly connecting Elders and AA Co’s recent trading performance with the looming FMD/LSD threat from Indonesia. However cattle prices had already started to decline before the industry unease over FMD risk started to set in last month, making it difficult to apportion impact...
Share bounce-back? ...
more, including graphs, links