Farm Ireland

Thursday 23 November 2017

6c/kg drop follows big squeeze by processors


Joe Healy

Beef men are hoping that the attempts by some of the plants to pull quotes and prices doesn't prove to be as contagious as the drop in credit ratings for countries across the EU.

It is obvious that the processors have decided that it is time to shout 'stop'. Reports suggested that they were very active over the weekend sourcing stock at last week's prices. The theory is that if they secured adequate numbers, they would then drop the quotes to see what the reaction would be this week.

Quotes for the steers today are probably 5-6c/kg back from last Tuesday, with the heifers down at least this amount and maybe a little more in places. Most factories are offering a base quote of 385-390c/kg for the bullocks, with 390-395c/kg being paid.

Some big finishers are holding out for €4/kg. Similarly, the heifer quotes are generally 395-400c/kg, with farmers refusing to sell at less than €4/kg. Top prices appear to be 405c/kg, even though 410c/kg was agreed with finishers over the weekend.

Men with good young bulls are bargaining for a flat price of 400c/kg for their R and U grades. This figure is the general quote for the Us, while the quotes for the Rs vary from 385-395c/kg. The plants are offering 370-385c/kg for the Os.

Commenting on the trade, the IFA's Michael Doran said that the markets remain strong and that farmers were bargaining for up to 400c/kg for their steers and 410c/kg for their heifers over the past few days.


The cull cow trade is probably holding a tad firmer than the rest. Donegal are offering up to 360c/kg for the heavy U-grade cow, with Moyvalley on 358c/kg. R grades are making 324-354c/kg depending on weight of carcass and also where you sell. Prices for the Os range from 322-342c/kg, with the P+ cows selling for 370-385c/kg.

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Bord Bia reported that trade for cattle continued to firm, reflecting a continued tightening in domestic supplies combined with ongoing tight supplies across some key export markets. Trade is being helped by demand for beef building across Europe in advance of the Christmas period.

Quotes for R-grade steers under the Quality Payment System were making €3.85-3.95/kg. Heifer quotes were in the region of €3.95-4.05/kg. These prices exclude the 6c/kg on in-spec quality assured stock. O-grade cows made €3.25-3.42/kg.

On a year-to-date basis, cattle supplies are running more than 4pc lower than the same period last year.

In Britain, trade remains firm in the run up to Christmas, helped by good demand, combined with tight supplies. The best of the trade is for forequater product, especially roasting joints.

Reported cattle prices from the AHDB have firmed, with GB R4L grade steers averaging Stg344.7p/kg deadweight (equivalent to 424c/kg including VAT deadweight) for the week ended November 19.

On the Continent, trade on the German market slowed somewhat last week. However, trade across most of the other key markets firmed, with prices reflecting this pattern. Activity on these markets continues to strengthen in advance of the Christmas period. Ongoing strong demand for forequarter product remains evident across most of the key markets.

The best trade reported was for feather blades and ribs. Some restocking of fillets and striploins has begun in retailers and wholesalers in some of the key markets.

In Germany, R3 young bull prices fell by 6/c to €4.01/kg, while O3 cows prices increased by 1/c to €3.13/kg including VAT. R3 young bulls in Italy fell, prices increased by 5/c to €4.20/kg and O3 cow prices rose by 1/c to €2.88/kg. In France, Irish steer hinds are trading at €5.26/kg.

The number of cattle slaughtered in October was 0.5pc higher than in October 2010. The number of cattle slaughtered in January-October this year was 4pc lower than in the same period last year.

Elsewhere, animal protein has become increasingly important in Asian (China, Phillipines, Vietnam, Indonesia, Taiwan, Thailand, Malaysia and Hong Kong) diets over the past decade.

This surge in demand is being helped by strong GDP growth, increasing tourism and existing retailers gradually shifting their focus to secondary and tertiary towns and cities.

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