Factory bosses flag price cut for bull beef

Up to 330,000 extra cattle and an increasing number of customer complaints have convinced factory bosses that bull beef prices should be slashed.

Bulls are currently making within 2-3c/kg of the steer base price, but the indications are that this differential could increase to 40c/kg in 2013.

While the national kill remains at a record low, official figures show that there are an extra 330,000 cattle under the age of 18 months on the ground compared to this time last year.

However, around 25,000 fewer calvings in 2010 and 340,000 live exports in the same year will prevent these extra numbers having a big impact on finished cattle supplies until next spring, Joe Burke of Bord Bia predicted.

"Live exports in 2012 will struggle to top 120,000hd," said Mr Burke. "So there's a lot more cattle in the pipeline."

In the meantime, beef plants are happy to use as much bull beef as possible to fill contracts. But it is causing problems for the factories' premium outlets, according to Mr Burke.

"We've been getting some complaints for a number of months but there has been a higher incidence over the last number of weeks," he admittd.

Bull striploins are up to 30pc bigger than those of steers and the subsequent cuts do not fit supermarket packaging or restaurant pricing levels.

In addition, they have less marbling than steer beef. Mr Burke said that bull cuts often made 20pc less than steer equivalents, but that this difference in price was not being passed back to farmers yet due to scarcity of supply. Slaney Meats managing director, Rory Fanning, said that prices for bull beef should be 40c/kg less than steers or heifers.

"Bull prices will have to come down. We saw the start of that in March and April when steer prices moved 15-20c/kg ahead of bull prices, but that gap has narrowed again on the back of scarcity," said Mr Fanning.

However, the Wexford-based beef boss was upbeat about beef prices for the next 12 months.

"I don't see cattle supplies increasing too much over the next six months. It will probably be similar to last backend and I think that price should come back closer to €3.80/kg than the €4.20/kg that is the benchmark at the moment. But I expect prices to be similar next spring to spring 2012," said Mr Fanning.

He believes that strong prices at the moment are a result of the trust which has been built up in Irish beef.

"This is all on the back of the quality assurance schemes. Farmers complain that they get nothing for this but the reality is that it just needs to be done to stay where we're at," said Mr Fanning.

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