Plants pay as much as 10c/kg over quote to get their hands on heifers
While it is not moving at quite the same level as the Tipperary forwards, the beef trade is none the less moving in the right direction. Plants remain reluctant to increase quotes significantly but are being forced, and are quite willing, to pay well in excess of those figures to secure stock.
One source told me it was almost a case of "whatever it takes" at this stage, adding that he had paid at least 10c/kg over the quote to buy steers and 15-20c/kg over the base quote to clap hands on heifers.
Farmers selling at the moment need to price around. With last week's estimated kill down at 27,140hd, the processors are tight on supplies and extremely anxious for stock.
Base quotes range from 350-360c/kg for steers but anyone willing to bargain is pushing that into the 355-364c/kg bracket. Similarly with the heifers, base quotes are in the 355-365c/kg range but prices more commonly range from 365-375c/kg. Different deals are being done all over the country, although the north-west appears to be a little flat at the moment and there are reports of cattle moving south and south-east of there. I heard of a deal for mainly O-grade bullocks being negotiated in the north-east for a price of 355c/kg.
Supplies of young bulls are also scarce. Flat prices of 375c/kg for a mix of R and U grades have been mentioned in more than one plant. Quotes and prices for U grades run from 358-378c/kg. R-grade quotes are at 350-365c/kg with the Os at 333-350c/kg.
IFA's Michael Doran said that with supplies of prime cattle scarce, sellers were in a position to dig in their heels and negotiate prices well above the quotes.
Top prices for good heavy R and U grade cows seems to be up around 319c/kg. O+ cows are making 314c/kg. Quotes and prices for O grades range from 286-308c/kg with some flat prices of up to 302c/kg being got for a mix of O and P grades. The P+ grades are making from 280-298c/kg.
Meanwhile, Bord Bia reported that the cattle trade improved during the past week as both prime and cow supplies tightened and the trade was also helped by some improved market conditions on the key export markets.
R-grade steers under the Quality Payment System were making between €3.56-3.60/kg. Heifer quotes were in the region of €3.64-3.70/kg. These prices exclude the 6c/kg on in-spec quality assured stock. The cow trade also improved, with O grade cows typically making between €2.88-2.97/kg.
In the UK, trade remained steady. Demand for round cuts continues to seasonally weaken. The best trade reported was for manufacturing beef. Trade for steak cuts continues to be helped by promotions.
Reported cattle prices from the AHDB have risen slightly with GB R4L grade steers averaging at £304.6 pence/kg dw (equivalent to €359 c/kg dw) for the week ended July 2.
On the Continent, market demand is being helped by the holiday season with on-going promotions reportedly taking place across some of the key export markets. In France, Irish steer hinds are making between €5.27-5.77/kg. R3 young bulls in Germany are averaging €3.48/kg, while O3 cows prices increased by 2/c to €2.96/kg. In Italy, R3 young bulls are making €3.70/kg, while O3 cow prices are making €2.83/kg.
Meanwhile, the Turkish Ministry of Agriculture has announced another increase in beef import tariffs -- the third increase since the beginning of the year.
It remains to be seen what impact this latest increase will have on the European beef trade as Turkey was the principal export market for European beef during the first four months of this year at 62,000t.
At the beginning of the year, beef import tariffs in Turkey were in the region of 30pc but have jumped to 75pc.
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