Farm Ireland
Independent.ie

Monday 17 December 2018

The rich list is one thing, factory quotes are another

Martin Coughlan

Martin Coughlan

MANY readers may, like ­myself, have sat down after Sunday dinner and perused the Sunday Independent's 'Rich List'. If you did, after half an hour your head would have been swirling from figures from the figures ­connected with farming and its performance in 2017.

  • €12.6bn: the value of Irish food, drink and horticultural exports in 2017, up 13pc on 2016.
  • €820m: Larry Goodman's wealth, up €40m in 2017.
  • €295m: the estimated fortune of Peter and John Queally of Dawn Meats, up €25m.

And even that black pudding you may have had with your breakfast comes from an offal industry now valued at €230m per year.

By yesterday morning, however, the net worth of Irish beef farmers had declined as factory bosses pulled quotes back.

The figures that matter today are the €3.95-4.00/kg being quoted for bullocks and the €4.05-4.10/kg for heifers.

But while most factories will start the conversation at the lower end, those with cattle to sell should not be taking any less than €4.00/kg for bullocks and €4.10 for heifers.

On a more positive note, both cull cows and bulls appear to remaining fairly steady. Quotes for under 16-month bulls remain steady at an R grade base price of €4.00/kg.

Bulls under 24 months see little movement with Us on €4.10 and Rs on that afore mentioned €4.00/kg. The O grades are on €3.90/kg.

Some factory agents tell me where numbers of bulls are being offered, a 3:1 split of Us over Rs would probably command a flat €4.10/kg price.

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I assume something similar might apply where Rs and Os are concerned.

Cull cows also remain steady with R grades making around the €3.70/kg mark with Os varying from €3.35-3.50 while your better P is at €3.30/kg with lesser Ps back from this by up to 30c/kg depending on conformation and cover.

So what has caused the rather sudden reversal of fortunes for those of us on the bottom rung of the beef ladder?

Storage

Factory bosses will argue it's to do with January being a poorer month after the Christmas splurge.

However, reports persist that there is no beef in storage and of factory bosses telling agents to make up lists of men with cattle in sheds. Note I didn't say cattle to sell - I said cattle in sheds.

In their efforts to regain control and create downward momentum, some factories have reduced the number of stock they are killing while others have dropped a day in the week.

I noted last week that while factories might succeed in backing up numbers by dropping the price, they could also succeed in possibly turning off supply tap.

From reports I had as we went to press yesterday some sellers were not too happy at the newly quoted prices and were considering their options, especially as last week's kill fell back to 32,974.


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