MLA reports that the estimated co-products value of Australian cattle during November plummeted between $28 and $52 compared to the previous month and $22 to $48 below November 2007.

Driving the fall were weaker values for offal, tallow and hides on a year ago.

The lower value of co-products is one of the reasons why Australian cattle prices have failed to increase with the falling Aussie dollar, MLA says.

Of the four cattle categories monitored, the estimated co-products value of a US cow during November was estimated to be at its lowest point in a decade, at $108.57/head, while the estimated co-products value of a grainfed steer ($214.15/head), Japanese steer ($191.98/head) and a prime steer ($157.73/head) hit five-year lows.

MLA reports that the current global economic downturn has brought uncertainty into world offal markets, with buyers from Russia, Indonesia, Korea and Hong Kong reluctant to sign long-term contracts.

While values of offal sent to Japan were stable during November, assisted by the weaker dollar, soft demand coupled with high stockpiles in Australia are expected to continue restraining prices and orders for December and January delivery.

Tallow values also fell during November, following the trend set by palm stearine prices and soft demand from China.

Meanwhile, meat and bone meal values during November increased, supported by the lower A$ and improved demand from overseas and the domestic market.

Hide prices have also taken a dramatic downward path since the beginning of October.

Hides are now worth less than a third of the price they received two months ago, with the global financial crisis and a tightening in consumer spending on luxury goods, such as cars and furniture, decreasing upholstery demand.