It has finished this week at 328.5¢/kg cwt.

This fall is in line with cattle prices generally, the MLA says, with most cattle markets starting 2009 on a softer note.

Hot dry conditions in southern states have forced additional cattle turnoff and reduce restocker interest.

Although heavy rain fell towards the end of 2008, pastures and feed in southern NSW and in patchy areas across the middle of the state have begun to dry off as the summer heats up.

As a result, more numbers (predominantly young cattle) are being turned off to compensate for the lack of feed.

So NSW yardings jumped up by 18pc this week, influenced heavily by these hot and dry seasonal conditions.

Forbes and Dubbo, NSW, for instance, have seen a 55pc and 115pc yarding's surge, respectively.

There have been two factors restraining price falls:

• Pastures in northern NSW and in patchy areas across the middle of the state have improved and producers in these regions are opting to hold onto available stock, in view of the softer market.

• Another major restraint on price falls is coming from Queensland. There, widespread monsoon rains have seen an area twice the size of Victoria under water, restricting cattle movement on or off farms.

This tightening supply of quality cattle and improved lines, however, have been unsuccessful in triggering an upward movement in grown cattle prices.

Export buying remains flat, as the disruptions generated by the credit crisis and associated stockpile liquidations continue.

Despite the lower $A, growth in export demand has not occurred, and consequently, a rise in cattle prices has not yet been initiated, the MLA says.

Along with deteriorating overseas demand, the price of hides also has continued to fall as the credit crunch takes its toll on luxury items, subsequently constraining processor margins and lowering over-the-hooks rates.