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NAPCO devalues, cattle station values drop

North Australian Pastoral Company (NAPCO) has devalued its freehold land portfolio by approximately $10 million, exacerbating the dip in cattle station values for the beef industry after the live export ban.

The company, worth $440 million, also slightly decreased the book value of its leasehold property by $1.2 million to $169.8 million.

The result comes after a combined $68 million in total write-downs from Macquarie’s Paraway Pastoral and Australian Agricultural Company in the past two months, the AFR reported.

It also happened before other major cattle station owners, such as the live-export centred company Consolidated Pastoral report their results. NAPCO does not have a huge focus on live export.

NAPCO chairman Christopher Lyndon said the company, which has a herd of more than 197,000 cattle, was ‘better positioned’ to ride out difficult industry conditions.

“In 2012, the revaluation of all the company’s stations saw some significant reductions in the value brought to account,” Lyndon said.

“However, the impact on the company has been less than that upon the industry generally, due in part to the quality of our assets, but also because of the ongoing yearly maintenance and improvements to those assets.”

In 2011, the company’s freehold land value rose by $252,000 to just more than $71.5 million. Its leasehold land value fell $1.7 million to $171 million.

A mixture of tough factors, apart from the oversupply of cattle caused by the live export fiasco, are hindering cattle-station values.

The continuing strong Australian dollar is hampering the export market. There is also a drought in western Queensland and the Northern Territory, which has boosted cattle sales and put pressure on prices.

This means lower income for operators and reduces the serviceability of debt.

Also, there are many cattle stations on the market. Cattle barons such as Graham McCamley and Ashley Daley have opted to offer big holdings.

Sir Graham is selling his range of cattle stations, once valued at more than $300 million.

His portfolio includes the Tartrus and Glenprairie aggregations, adding up to more than 61,000 hectares and containing 12,000 head of organic cattle.

Daley is selling his 125,000 hectare Lotus Vale and Stirling stations in far north Queensland.

Plenty of surplus and lower quality assets from separate vendors is also on the market, putting pressure on values. Earlier this month, a cattle station near Katherine, Northern Territory, was shrunk for sale, with a 35 per cent discount on its 2009 purchase price.

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