Factories: Bank holiday blues as supply surge sends cattle prices south
Prices at the factory gate appeared to be under further pressure yesterday with some quotes from agents back another 5c/kg on last week.
The fact that this is a short week probably doesn't help. There were no kill figures available yesterday due to the bank holiday, but with the kill standing at 34,448 two weeks ago - and with reports that factories were full for this week - would you be willing to bet they will be less when they do emerge? Me neither.
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This latest surge in numbers has done the obvious thing - driven prices south. Yesterday, I only had one agent who was willing to quote a solid €3.90/kg for bullocks and €4.00/kg for heifers. Everybody else I spoke to was on €3.85 and €3.95.
That one man standing alone against the tide of perceived wisdom struck me as being a bit like John Wayne in the Wild West films of old. Outnumbered and outgunned, and with the townfolk cowering behind their windows, he'll still make a hell of a fight of it because he knows how to survive, he has to.
In the world of the Irish cattleman, it's always about numbers - or more to the point, reading those numbers.
This man argued that with grass growing very well and prices falling, the numbers of stock coming off of grass may not materialise as quickly as some might think. The reason being that farmers will hold stock to graze surplus supplies plus, at this time of the year, the temptation has always been to put up extra weight as cheaply as possible to counter any fall in factory prices.
Yes, you could bale up that grass, but that counts in the short term as an expense. If this man is right and allowing that you can only kill what shed cattle that are left, next month could see the start of something interesting.
Bull prices too were under pressure yesterday, with only those who sold stock last week able to command €3.85/kg for Us. Yesterday, €3.80/kg for Us seemed to be the absolute top, with Rs back around €3.70/kg and Os varying, depending on breed, from €3.40-3.60/kg.
The cull cow continues to defy expectations, with prices falling by 5-10c/kg but not collapsing as a result of the negativity. I'm told you can still get up to €3.10/kg for your better P grade, with Os operating from €3.10-3.20 and R grades €3.30-3.35/kg.
There is another issue that is really starting to annoy those in the fattening business: how that famous €100m might be divided out.
The fact that Minister Creed has yet to make a decision on the matter has driven the farming rumour mill nuts.
With no clarity on how and when the money might be divided, there are some who now believe this limited pot might be extended to include stock either bought or sold in May.
The initial expectation was that only those who killed cattle between October and the end of March would be eligible, but now it appears that everybody and their mother expects a cut.
Clarity is required minister.
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