It's time to box clever with processors over prices

Robin Talbot was struck by the quality of the livestock
Robin Talbot was struck by the quality of the livestock

Joe Healy

Over 50,000 students received college offers yesterday. I would safely say that if the majority of beef farmers had their time back again they would opt for the books rather than a seemingly never-ending price battle with processors.

The downward pressure on prices continues this week with many of the processors 
dropping their quotes by a further 5c/kg for the underage stock.

It gets worse for the overage as a base price gap of between 10-15c/kg has now reappeared between the under and over 30 month stock.

Add the Quality Assurance loss of 12c/kg onto this and a steer a day short of 30 months is making 27c/kg more than animals a day or two older in the same herd. This equates to a loss of over €100 on a steer killing out at 400kg.

This is within the same plant but when the 345c/kg base for the older stock here is compared to the 365c/kg for the in-specs in a different plant. the gap opens up to 32c/kg including the 12c/kg QA loss.

Many of the plants are now quoting as low as 360c/kg for in-spec steers and heifers.

A few continue to offer 365c/kg for both categories and for the early part of this week the cattle being slaughtered are on a base of 365c/kg.

Some deals of up to 370c/kg were negotiated late last week for cattle being slaughtered this week.

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So it can be quite confusing as factories play their usual game of buying a few days supplies and then talking down prices and trying to buy stock for later in the week at the lower prices.

With prices steady to improving in Northern Ireland and showing signs of improvement in Britain, the cuts here are difficult to justify and accept.

The top young bulls are generally selling at between 350-360c/kg but reports suggest that deals of up to and maybe over 370c/kg are being negotiated.

Some farmers are also achieving a bit more success when they start discussing weight limits. Quotes and prices for the R vary from 340-350c/kg but some finishers are bargaining to get some Rs included at the price they secured for their U grades. The Os are making from 300-320c/kg.

A number of factories have attempted to pull the cull cow quotes also, but farmers with numbers of top quality lots have secured up to 350c/kg.

Quotes and prices in the main are between 330-340c/kg for the U grades while the Rs vary from 320-340c/kg. The O grades are at 300-320c/kg while the P grade cows are making from 280-300c/kg.

Price around if you have cows to sell as very often there can be a kind of "ah sure he sells his other cattle here so he won't move elsewhere with his few cows" attitude from the agents. It's no harm to call their bluff from time to time.

Meanwhile, IFA national livestock committee chairman Henry Burns said very good progress has being made in resolving the problems impeding the live export trade to Northern Ireland.

Following talks by the IFA with processors in Northern Ireland, Minister 
Michelle O Neill has now given approval for an Irish brand to be used on cattle exported from the south, fattened in Northern Ireland and subsequently slaughtered in the North.

This is a positive development and will hopefully allow for cattle exported from the south to feeders in the North and slaughtered in the North to be branded and sold as Irish, removing any confusion on the origin.

Beef will be labelled in full compliance with EU regulations specifying that the animals were born in Ireland, reared in the UK and slaughtered in the UK.

The live trade to Northern Ireland is hugely important for price competition, particularly for store and weanling producers in the west and border counties.

With sterling at 79p against the euro and a significant 
shortage of cattle in Northern Ireland the potential for this trade over the autumn and into 2015 is very significant.

In the past up 60,000-70,000 cattle have moved North.

Bord Bia said that the cattle trade remained under pressure over the past week due to high supply levels at export meat plants. Trade is slow across our key export markets. Prices decreased further.

The majority of steers and heifers were purchased at a base price of between €3.65-3.70 /kg on the Quality Payment System. These prices exclude the €0.12/kg bonus which is payable on in-spec QA animals.

Prices paid for O grade cull cows were generally between €2.95-3.10/kg.

Cumulative supplies for the year-to-date are running at around 107,000 head or 12pc above the 2013 figures. Throughput of prime cattle continues to be up significantly.

In Britain, reported cattle prices from the AHDB increased with GB R4L grade steers averaging at Stg 343.2 p/kg deadweight (equivalent to 450c/kg including VAT).

Indo Farming

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