Farm Ireland

Saturday 24 March 2018

Suppliers failing to get plants to up their price

TESTING TIMES: This cow sold well at Cahir Mart last week but farmers are struggling to get the price up much at the factories JENNIFER O’SULLIVAN
TESTING TIMES: This cow sold well at Cahir Mart last week but farmers are struggling to get the price up much at the factories JENNIFER O’SULLIVAN

Joe Healy

A farmer I spoke to yesterday morning, paraphrasing new Ireland manager Martin O'Neill, said that "half of the beef factories are bad cops and the other half are bad bad cops".

The quotes and prices he will be reading about in this column will do little to improve his opinion. Steer quotes are stuck at the €4/kg with non-quality assured stock being quoted a base of at least 10c/kg below this figure in places.

Most farmers are failing to get the plants up much from this even money but 405c/kg has been achieved. Heifer base quotes are generally at the 410c/kg but farmers are securing 415c/kg.

If you have plainer type O grade bulls, the North at 390c/kg plus free transport continues to be unmatched in the South where quotes are more often in the 370-380c/kg bracket. R grades are making between 390-400c/kg with the U grades at 400-410c/kg. The higher figure seems to be more associated with the midlands.


Cull cow quotes vary quite a bit with as high as 40-45c/kg of a difference between what one farmer might be quoted from one plant and what another might get from a plant elsewhere. This is especially true for the good heavy cows.

Prices of 385-390c/kg have been paid for top U grades while at the same time some farmers have sold similar cows for 350c/kg. The R grades are not much different, with a price range of 330-375c/kg being paid. We might give out about the factories keeping prices down but many farmers have no one to blame but themselves if they are losing out on up to 45c/kg. On a 400kg carcase this runs up to close on €200. Very few O grades are sold outside of a range from 310-335c/kg. P grade cows are making from 300-320c/kg.

There was little change in the cattle trade last week according to Bord Bia, which reflects steady demand for supplies as trade builds for the Christmas period. Trade is also being helped by tight supplies across our key export markets.

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Base quotes under the Quality Payment System were making between €4.00-4.05/kg for steers and between €4.10-4.20/kg for heifers. The trade for cull cows remained steady, with quotes for O grades generally making between €3.25-3.40/kg.

For the year to-date, cattle throughput is running almost 97,000 head above last year's levels. Steers and cows continue to account for most of the increase. Last week's kill from the Department of Agriculture stood at an estimated 32,300hd, which is some 1,130hd up on the corresponding week last year.

In Britain, trade weakened slightly on the previous week's trading. A slow trade for steak cuts continues to persist. However, demand for round cuts and roasting joints is being helped to some extent by seasonal demand. Reported prices from the AHDB eased during the week, with the GB R4L steer price now making 398.6p/kg (equivalent to €5.01/kg incl VAT).

On the Continent, the seasonal shift towards forequarter cuts cuts continues. Best demand continues for chucks. Demand continues to be boosted for forequarter cuts in response to increased promotional activity.

In France, the R3 young bull increased by 3/c to €34.01/kg inclusive of VAT, while the 03 cow price also increased by 3/c to €3.62/kg. The R3 young bull in Italy was making €4.25/kg including VAT, while the 03 cow increased by 2/c to €2.86/kg.


Elsewhere, former agriculture councillor at the French embassy, Ralph Ichter, issued a cautionary note on the reopening of US markets: "Don't expect a lot of Irish or French steak to land on American dinner tables anytime soon now that the US has lifted its ban on imports of European Union beef, which it imposed 15 years ago because of fears over 'mad cow' disease."

With the European Union barely a net exporter of beef as it is, last week's final rule overhauling US import regulations for BSE may have served more as a quid pro quo aimed at helping the United States and EU broker the massive Transatlantic Trade and Investment Partnership deal.

"It's important in terms of setting a precedent. If the US opens up, it will probably help to open to other markets as well, but it's not earth-shattering in terms of trade," said Mr Ichter, who now represents French agriculture interests in Washington.

In fact, the USDA's Economic Research Service reports that foreign-born cattle constituted on average only about 8pc of monthly US beef products over the past 13 years, and most of that has come from Canada and Mexico.

But the final rule could grease the wheels of the trade talks to the benefit of US agriculture interests.

Irish Independent