Farm Ireland

Wednesday 13 December 2017

Why there's the chill wind of beef cuts price cuts in the air

Some factories were “flooded” with cattle last week.
Some factories were “flooded” with cattle last week.
Martin Coughlan

Martin Coughlan

 I was reminded prematurely of the coming changing of the seasons by reports — primarily from the south — that some factories were “flooded” with cattle last week.

And these additional numbers were this week being translated into a price drop that in some cases was heading below the €4.00/kg mark.

Will those factories who yesterday morning told their agents to drop their quotes back to €3.95/kg get cattle at that price?

One independent buyer I spoke to told me: “There’s a big difference in a farmers head between €4.00 and €3.95 - a far bigger difference than between €4.05 and €4.00.”

There is no doubt that fac­tory bosses want prices back, with all sorts of ominous figures doing the rounds for what might be on offer come early October.

In the meantime, my infor­mation is that general base prices last week stayed solid from €4.00-405/kg.

There was obviously more for those on contract, with quotes yesterday for bullocks ranging from €4.05/kg back to that €3.95/kg figure.

Quotes for heifers have also eased by 5c/kg, with the price range for the early part of this week at €4.05-4.10/kg, with a shake of €4.15/kg still about.

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There is no doubt that de­spite predictions of “disaster ahead” early on in the year, the trade has worked itself out steadily without too much drama thus far.

Yes, prices have slid back from six weeks ago but what my contact said about the dif­ference between €4.00/kg and €3.95/kg is going to define the next six weeks.

Yes, it will be all about numbers and to that end the farm organisations should be encouraging farmers to sell in groups to the factories.

It’s far easier for the factories to pick off a man with five, 10 or 20 cattle than a couple of lads with 50, 60 or 70.

Bull prices remain fairly static with the base for under-16 months reported as being steady on €4.00-405/kg.

In the over-16 month stock, U grades are on €4.10/kg, with Rs on €4.00/kg and O grades on €3.90-3.95/kg.

Cow prices also remain largely unchanged with Rs on €3.60/kg, and O grades steady at €3.40-3.45/kg.

The P+ cow is floating from €3.40/kg back to €3.30/kg depending on the plant and the deal being done,

Other P grades, provided they have reasonable fat cov­er, are in the €3.20/kg region.

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