Pace of factory price tumble shows signs of slowing down
Factory prices remain under pressure. However - with the kill figures last week coming in at 34,650 - are there signs that the possibility of further downward pressure might be easing?
Also, a story doing the rounds last week was that bullocks would be pulled to €3.55/kg yesterday. That pull has not yet materialised as prices being paid appear to be holding at €3.60-3.65/kg. That said, agents appear to be under instruction as this week goes on to quote that lower €3.55/kg figure.
While bullock prices hold, heifer quotes yesterday were back 5c/kg in some places to €3.65/kg. However, a quoted price isn't the same as a buying price - the buying price continues to be around the €3.70/kg mark, with maybe a little more in some deals.
The bull, however, continues to suffer the most pain with prices sliced by up to 10c/kg. Yesterday the best quote I could get across the country was U grades at €3.55/kg, R grades at €3.45/kg and O grades at €3.35/kg, with some agents quoting 5c/kg less. Friesian O grade bulls are back at around €3.20/kg. When challenged on the price and pointing out that O grade bulls are now only 30-40c/kg above offerings for O and P grade cull cows - a waste product from dairy farms - I was told in very direct terms: "We don't want bulls".
Sometimes I do wonder if factory agents have anyone to share a pint with on a Saturday night.
In contrast, cull cows prices are generally unchanged. Indeed, mart managers reported last week that they have noticed a strong upswing in the price of 'short keep' culls (two-three months). Whatever the rational for this, yesterday R grade culls were around the €3.00-3.10/kg mark, with O grades on €2.90-2.95 and better P grades at €2.80-2.90/kg.
Angus Woods of IFA criticised the factories strategy. "This is not only undermining the confidence of beef and suckler farmers, it is also undermining prices and the value of our beef in the market place," he said.
The release last week of details of how the €100m markets support package for beef farmers will probably be divided has brought some much-needed good news to an embattled sector. After a relatively short campaign, Big Phil, Minister Creed, the IFA and ICSA have delivered. The question now is with factory prices in a worse place than during the reference period, September 24, 2018 - May 6, 2019, will we see any further attempts by the Government and the EU to put other additional monies in place in the future? Or do we need another election to focus those political minds?
One shrewd observer pointed out to me that nowhere in the draft document presented by the Department last week was there any reference to Brexit. Is this an indication that the mandarins in Ag House recognised very early on that this initial compensation for poor prices and rising costs was going to have to be kept separate in the minds of those in Brussels from any future supports that may have to be lobbied for as a direct result of Brexit when it actually happens?
With all the uncertainty over markets, prices, Brexit and Mercosur, a cousin of mine down from Dublin at the weekend summed up the conundrum of why Irish farmers stay at cattle.
"Martin, it appears to me ye farmers are like the third mystery of Fatima - unsolvable."
Never a truer word spoken.
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