Factories attempt to reduce quotes as standoff develops
Beef factories in the south are not endearing themselves to farmers this week, following their attempt to pull the quotes by at least 5c/kg.
The rumours are that a few of the plants are killing some of the cattle out of their own feedlots this week as an opportunity to drop the quotes and test the mood. Nothing new or surprising there you might say. Some of the low quotes mentioned were down at €4.08/kg in the south. Most finishers were as good as hanging up on the agents when this figure was mentioned.
In general, most of the steers being killed today are bought at a base of €4.20/kg, with the heifers at €4.25-4.30/kg. Again, plants in the south have been trying to buy heifers at €4.20/kg but have been finding it hard to get farmers to sell. Finishers have a minimum of €4.25/kg in their head. With numbers guaranteed to tighten, they are not going to settle for less without a stand-off. Farmers with steers to sell need to be tough to avoid a €50 drop in the value of a 400kg carcase.
The young bulls and the cows appear to have escaped the lower quotes. Mixes of R and U grade bulls have made up to €4.25/kg. Farmers selling Rs have got €4.20/kg. The O grades are making from €4.00-4.05/kg. Cull cows are selling for a range from €3.55-4.00/kg, with the Ps at €3.55-3.65/kg, the Os at €3.60-3.70/kg, the Rs at €3.80-3.90 and the U grades at €3.90-4.00/kg.
Bord Bia reported little change in the trade across our key export markets. Cumulative supplies for the year to date are down around 3pc on supplies for the corresponding period last year standing at around 519,000hd.
In Britain, cattle prices for GB R4L steers averaged €4.96/kg, with trade was reported as steady for most cuts, but slow for rumps.
There was little change in France with on-going promotions centred on roasts, fillets and sirloins. The R3 young bull price was at €3.85/kg, while the O3 cow price was up 4c to €3.40/kg. In Italy, the trade was reported as slow on the back of sluggish demand with an increase in competition also reported. The R3 young bull price was down 9c at €4.04/kg and the O3 cow price was down 6c to €2.87/kg.
Despite production in Ireland in the first quarter of 2015 being very similar for the same period in 2014, EBLEX says that production will fall at a faster pace in the coming months to finish 5-7pc down this year.
Elsewhere, latest British trade data shows a notable 14pc increase in beef imports from Ireland.
Price differentials between Irish and English stock have narrowed in recent weeks, from over 80c/kg at the beginning of March to 62c/kg last week, which is a difference of €217/hd on a 350kg carcass.
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