Factories: Prices ready to rocket even as kill figures hit year-high
When you see a cull cow making €2.28/kg or €2,380 at Roscrea mart in the same week that factory kill figures hit a year high of 39,800, you really begin to see where beef prices could go.
As of yesterday morning, €3.85/kg was available "at every crossroads" for bullocks, but those serious about selling are getting €3.90/kg, with a further 5c/kg reported as "possibly possible".
The story with the heifer is the same, €3.95/kg being offered, but deals are only being closed when €4.00-4.05/kg goes on the table.
Returning to that Roscrea cull cow, what would she have to make at the factory gate just to get out? She is reported as being R/U-grade; however, yesterday's U-grade quotes for cows of €3.60-3.65/kg leaves her a long way off the price that would be needed to recover her cost.
My sums say she has to do at least €3.75-3.85/kg to get out. The point of this little exercise is to show what factories can give when they want - and remember this animal will never get any quality payments, she was bought and paid for simply because she was big beef.
Moving back to the more ordinary R-, O- and P-grade cows, prices at the lower end continue to strengthen, with P-plusses pushing onto €3.20/kg while lesser Ps range from €2.90-3.10/kg. O-grades are on €3.20-3.30/kg, with R-grades in the €3.40-3.50/kg bracket and U-grades on €3.60-3.65/kg.
The story of improving prices despite continuing massive weekly kills continues into the bull section, with prices here too reported as moving strongly upwards especially for those heavier better-conformation bulls under 24 months.
I was given a price of €4.10/kg as having been paid over the weekend for combination loads of U- and R-grade heavy bulls. Base prices for U-16 month stock appear to be floating from €3.90-4.00/kg as they too edge upwards.
Looking further afield to Europe and the ongoing talks on a trade deal between the EU and South America, the ICSA's Paddy Kent had some choice words about the timing of these talks last week.
"It is monumental folly to allow 70,000 tons or more of extra South American beef into the EU at a time when we have no idea what the trading arrangements will be between the UK and Europe," he fumed.
Mr Kent is right. We in the beef sector have been very fortunate this autumn that despite ever-increasing kill numbers at home the demand for product on international markets has been such that prices have strengthened. We don't need the Argentinians or Brazilians worrying the pitch.
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