Farm Ireland

Friday 22 September 2017

Little change hurts hope of hitting target

Joe Healy

I was hoping that this week's beef quotes and prices would be as positive as the fortunes of our four rugby provinces over the weekend. Alas, no such luck, with little or no movement -- thereby ensuring that we remain a hell of a distance from the 320c/kg that was mentioned as a target price in the short term at the beef grid meeting in Tullamore, Co Offaly a month ago.

OK, the kill has remained strong, with last week's estimated kill somewhere short of 30,000 head. This is about 5,000 animals more than the same week last year. Some farmers will argue that it is a fear of the grid, with finishers selling sooner in case their cattle would go into the 4+ or wrong fat score, that is keeping the kill so high. Another farmer contacted me and said that he was selling over-age cattle on the grid at a base of 291c/kg. He added that, under the old system, he would probably be selling at 280c/kg for all his O grades and 291c/kg for his Rs. On the grid he is on the 291c/kg for his R= and R-, but he will be on 279c/kg for his O+, 273c/kg for his O= and as low as 263c/kg for his O-4+ animals. He didn't think he had any R+ cattle but, if he had, he said he would prefer the old system as he felt he had more control and was less confused.

Donegal continues to lead the way on prices with its 311c/kg and 322c/kg for quality assured underage R- and U-grade steers and heifers. It paid 302c/kg for R-grade young bulls and 322c/kg for the Us. Kepak Clonee paid similar for the R bulls but was a bit better, at 325c/kg, for the U grades. Overage R-grade steers sold for a flat price of 302c/kg in the east late last week, and there were reports of 305c/kg paid further south for similar type R grades.

Elsewhere, the base price ranges between 291-294c/kg for the bullocks and 297-300c/kg for the heifers. Most of the AIBP, Dawn and Kepak plants, and Slaney, Liffey, Kildare, Dunbia and Moyvalley are included at those figures. The 6c/kg quality-assurance bonus is paid on top of those prices.

ICSA's Sean Scully advised farmers to hold back from selling at the current low prices, and urged the processors and retailers to treat farmers fairly and pass back realistic returns.

The cull sow trade has improved. Top prices of 280c/kg for heavy U grades are available in the northeast, where the Rs are making up to 266c/kg and Os 252c/kg. Moyvalley is quoting a top of 252c/kg, with the Os in a 241-252c/kg range.

The cattle trade resumed to more normal levels last week, according to Bord Bia, as improved road conditions led to a pick-up in activity. Overall, there was little change to report in the trade levels.

Quotes for R-grade steers under the new quality payment system continue to make a base reference price of 291-297c/kg, while heifers are still making 297-302c/kg. These prices exclude the six cent on in-spec, quality-assured stock. The trade for cows remains unchanged, with O-grade animals making 235-246c/kg.

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In the UK, trade was reported to be quiet. Reported cattle prices from the AHDB remain strong, with GB R4L grade steers averaging Stg288p/kg dw (343c/kg including VAT dw) for the week ended January 9.

On the continent, most markets are continuing to re-stock after the Christmas trade, which has helped demand. The best trade continues to be for forequarter cuts, with most markets reporting that consumers are price conscious after the festive season. In France, Irish steer hindquarters are making €4.10-4.20/kg. R3 young bull prices in Germany were unchanged at €3.30/kg, while O3 cow prices increased by 7c/kg to €2.31/kg. In Italy, R3 young bull prices remain unchanged at €3.97/kg, while O3 cows are still making around €2.16/kg inclusive of VAT.

Meanwhile, last year's Irish cattle supplies at export meat plants fell by more than 4pc to 1.525m head. The majority of the decline is based on significantly lower disposals of steers, partly due to a strong rise in the number of finished cattle exported live to the North.

Prime cattle supplies were 68,900 head below 2008 levels at 1.16m head. Steer supplies for the year were almost 10pc, or 70,700hd, lower at 635,700hd.

In contrast, young bull throughput was more than 10pc, or 11,300hd, higher at 120,200hd.

Irish Independent