China cattle imports boost NT confidence

A billion-dollar live cattle export deal with China will help restore confidence in Northern Territory cattle farmers after several lean years.

The federal government is believed to have all but signed a live export deal to sell one million Australian cattle worth up to $1 billion to meet China's growing demand for beef.

It comes as the major trading partners edge closer toward a free-trade agreement after almost 10 years of talks.

NT Cattlemens Association CEO Tracey Hayes says farmers are cautiously optimistic about the beef deal.

"There's a level of confidence growing among northern producers, and that's been missing for a while," she told AAP on Friday.

Many were still struggling to recover since 2011's blanket ban on live cattle exports to Indonesia.

"It's really great for producers to start to have an increase in farm gate returns so they can invest back in their businesses and pay back some debt - all those things that really lend itself to a healthy community," Ms Hayes said.

She said the million-head figure is based on the potential demand in China, but "we're not positioned currently to supply that amount of cattle in addition to the existing cattle we've got".

It's as yet unclear what kind of cattle China will be looking for, whether it's feeder, slaughter-weight or dairy cattle, and it is too soon to say how many could be exported from the territory.

Regardless, "it's going to be very good for the NT", Ms Hayes said.

China buys Australian dairy and beef breeder cows, and took more than 78,000 head of dairy cattle and 15,000 beef cattle last financial year.

Meanwhile, Vietnam has been a solid market for NT cattle in the last year, and Cambodia is an emerging market, which is vital for diversification for Australian producers, Ms Hayes said.

Shares in beef exporters Australian Agricultural Company and Elders surged on Friday after reports that the live cattle deal was pending.

AACo shares rose 12 cents, or 8.39 per cent, to $1.55.

Elders shares added two cents, or 11.43 per cent, to 19.5 cents.

"Any opening of the trade relationship is certainly very positive, especially if it comes with reduced tariffs," Morgans analyst Belinda Moore said.