Marts : Farmers feel mental strain in world of falling prices
Each mart manager or auctioneer I have talked to over the last week has spoken of an air of despondency among their clients. Mart managers note many things as they go about their business, and when the mood music changes, they notice.
So I decided to look back at the numbers over the last few years to get a feel for where we are with current factory and mart prices. The results were surprising.
This time last year our Ringside figures show overall bullock averages across all weights running from €1.87-1.90/kg, with factory base prices at €3.90-3.95/kg.
In mid-July 2017, factories were paying a base of €4.00-4.05/kg for bullocks, leading mart averages to range between €2.07-2.12/kg.
In mid-July 2016 marts were averaging €1.96-2.08/kg, with factory base prices on €3.80-3.90/kg.
Last week mart prices averaged €1.81-1.89/kg as factory prices were €3.60-3.65/kg.
The message from these figures is that the mart price for bullocks has stayed remarkably resilient in the face of factory prices that are around 30c/kg less than they were 12 months ago.
That 30c/kg factory price difference equates to €111/hd on a 370kg carcase, while on the mart side that price of €1.81 on your 600kg+ bullock is just €36/hd less than 12 months ago.
So, what's going on?
On the face of it the figures indicate that mart prices are out of line with factory returns by over €70/hd. Yet, it's the men selling the store animal who are seemingly the most depressed.
Is a fear of what may yet happen weighing on the minds of those who are now selling?
Marts are small at this time of year. Most men I spoke with reckon that supply and demand are more or less in balance, but what would happen if that was not the case? Would you then see that €111/hd difference in the price of your beef animal from last year being reflected more fully at ringside?
It appears that some in the beef trade are frightened beyond what the figures above might indicate.
The cattle game over the last 10 years has been a relatively low-margin business, and part of what we are now seeing is farmers feeling the mental strain of trying to make it work over a number of years in a world of rising costs and falling returns.
Talk about Brexit and the Mercosur trade deal has, naturally, focused on worse-case scenarios, raising the fear level for the future. Despite the fear of what may lie ahead, the immediate concern that grass may get out of hand has been enough to see prices maintained.
The cattle trade at every level has always been full of contradictions and questions as both buyers and sellers look for guidance on the way ahead. To quote George Candler of Kilkenny mart: "Answers on a postcard please."
In the know...
The feeling here was that the need to get grass eaten outweighed concerns around Brexit and Mercosur as prices were largely maintained. Sample prices on the bullock side included a 495kg Limousin at €2.41/kg, a 470kg Angus at €2.45/kg and a 655kg Charolais at €2.14/kg. On the heifer side, a 400kg Limousin sold for €2.30/kg, a 520kg Angus made €2.26/kg and a 350kg Charolais went for €2.43/kg. The best of the continental dry cows sold around the €1.90-2.00/kg mark. There were bigger numbers of calves on offer, with prices varying from €40-280/hd, with the stronger runner types making €260-640/hd.
Bullock numbers rose here, with George Candler noting the trade as "challenging"; despite this, a good clearance was effected. Prices on the 600kg+ section averaged €1.70-2.00/kg, with the tops seeing €2.15/kg. In the 500-600kg division averages ran from €1.45-2.45/kg, while among those from 400-500kg prices ranged from €1.50-2.52/kg. Lighter bullocks sold from €1.30-2.68/kg. Beef heifers made €1.80-2.35/kg, with forward store types making €1.70-2.15kg. Lighter types sold from €150-2.37/kg. Friesian cull cows made €1.00-1.60/hd, with continentals making €1.20-1.75/kg.
Michael Harty felt trade was more challenging, with a big turnout of young bulls seeing prices ranging from €1.80-1.85/kg, where a month ago they were €2.00-2.10/kg. The better heifer was a "flyer", with a batch of 413kg Limousins making €2.18/kg. But he wondered where the bull market will be in 12 months as a number of his customers told him they don't intend to return to feeding.
Sean Ryan commented on the disillusion that farmers in the trade are feeling. He also wondered why there is so much fodder, asking: "Are the numbers of cattle not in the country to eat the grass?" Your good 400-500kg animal, whether bullock or heifer averaged, €2.10-2.40/kg. Among the weanling bulls your good one made from €2.10-2.60/kg with the plainer one back round €1.90-2.00/kg. Cull cows were a stronger trade than recently with the good one €1.80-2.00/kg.
John O'Hanlon reckoned the current over-supply of grass is a major factor in the mart prices continuing to maintain. Heifers sold well, with one man seeing a batch of ten 505kg Limousins selling for €2.16/kg. While John commented on an air of despondency among farmers, he also noted that pride still matters. A price of €2.89/kg was the result when a couple of serious judges went head to head over two 440kg Charolais bullocks. Those two aside, bullocks were steady in general. Cull cows sold for €1.60-1.80/kg.
The stronger performers were among the cull cows and the lighter stores. Beef cows sold from €300-750 over the €1/kg, with feeding cows making €120-315 over their weight. Among the lighter continental store bullocks' prices ranged from €420-685 over the €1/kg, with lighter Friesians making €100-350 over the €1/kg. Heavier Friesians made €385-600 over their weight, with continentals making €500-900 over the weight. Hereford and Angus heifers sold from €275-415 with the €1/kg, with continental stores making €380-650 over.
Bullocks here ranged from €1.17-2.76/kg, with that top per/kg price going to 310kg Charolais that sold for €855. Top overall price went to a 565kg Limousin-cross that clicked €1,280 or €2.27/kg. The best of the heifers saw a 540kg Limousin making €1,180 or €2.19/kg.
The overall range of heifer prices ran from €1.64/kg to €2.72/kg.
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