Farm Ireland
Independent.ie

Wednesday 24 May 2017

Beef Prices: Factories maintain pressure on prices

Martin Coughlan

Martin Coughlan

The business of selling cattle out of sheds at the minute is a bit like the lady who meets that apparently very nice chap on a Saturday night. He takes her number and promises to ring.

Cattle farmers with beef to sell today are, like that lady, yet again discovering that if, or when, ‘your man’ does ring, he’s not half as nice as he appeared.

Unfortunately, there’s very little loving in the beef trade this week, Valentine’s week or not.

This is another way of saying that factory prices as of yesterday morning continue to be under pressure, with last week’s quotes of €3.80/kg for bullocks reported to be easing back to a more general €3.75/kg, while heifer quotes also appeared easier at €3.85 from €3.90/kg.

That said, it will be Wednesday before a verdict on these prices can be realistically past as any stock going through plants today or yesterday were more than likely bought last week at those higher prices.

An issue that was brought to my attention recently has been the cutting in the Aberdeen Angus bonus from €0.15-0.20/ kg back to €0.10/kg. While I recognise this bonus has a history of volatility, many who bought Angus stock last autumn would have been banking on the higher figure remaining stable for the winter months.

As I said last week, strong supply is killing the trade for the winter finisher.

I’ve always been a believer in watching the price of cows as it’s not a bad barometer as to the health of the trade overall.

This week sees their prices holding steady, with P+3s on €3.10/kg, while lesser Ps come in at €3.05-2.90/kg. Meanwhile, O grades continue at €3.20-3.25/kg, with Rs priced in and around €3.40- 3.45/kg.

The price of bulls up to 24 months remains unchanged at €3.90/kg for U grades, with Rs on €3.80 and O grades on €3.70/ kg. €3.80/kg remains the base price for those selling under 16-month stock.

The spat between ICSA and IFA on the best way forward for the suckler business hasn’t thrown up any new ideas. However, a good discussion on the future of the suckler sector is long overdue.

Returns

Both organisations appear to recognise that the issue is market returns; however, ICSA’s suggestion of giving a €200/ hd per year per cow payment to suckler farmers to get out of production throws the onus of change entirely onto the heads of our premium beef producers.

In my opinion, this is not where it belongs.

Putting suckler farming on the scrap heap serves no purpose other than opening up more opportunities for the dairy beef animal.

Giving a €200/hd cow subsidy to keep production going, IFA’s suggestion, equally doesn’t address the issue of better market returns.

The question is how the industry gets to the point where true grass-fed Irish beef gets the premium it deserves?

It requires serious thought on shipping and marketing initiatives, plus a look at which breeds really suit Irish conditions for finishing.


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