Signs of tension in the cattle trade

By Matt Dempsey and Declan O'Brien

The market is split even more dramatically this week. The UK, the Netherlands and Northern Europe are all reacting as if there was no problem in the beef market, however, it is a different story elsewhere.

British prices have hardened steadily over the last fortnight and are forecast to continue doing so, even if at a slower rate. Scottish R4Ls are up to 108p/lb Irish equivalent (including VAT) and Northern Ireland prices are being dragged up despite imports of young bulls from northern England.

Continental Europe is flooded with young bulls, especially Germany and France. The Irish plants complain that they are hitting the market at prices as low as 65p/lb, as farmers despair of sensible national aid measures. So far the Irish plants, with steady long term commercial steer markets, are finding that their traditional customers are sticking with them. But the plants are worried.

The actual reality of combining the cull scheme with normal commercial trading is extremely difficult and those groups with the option are expected to go down the dedicated plant route within the next few days.

Plants are being given permission by the Department to blast freeze the SRM and place it in central cold store facilities. But while the cull returns may pay for this, the cost of doing it for the commercial over 30 month animals is going to be a point for negotiation.

The factories, uncertainties are being compounded by the return from Saudi Arabia of another 1,500 tons of high value beef, as a result of a decision taken just last Friday.

A few plants are testing for cows, but one plant operator contacted by the Journal said he would be scared to test cows in his own plant in case he had a reactor and he was in the process of renting a separate killing line.

So far the crisis is being handled. The commercial market for over 30 month cattle is there and factories killing for it are giving the full cull price and even more in some cases.

Donegal Meat Processors are quoting 97p-95p for U grades over 30 months, 94p-92p for R grades and 91p-89p for O grades. Slaney Meats are quoting 91p-88p for steers over 30 months.

The under 30 months trade is strong and getting stronger. Some plants maintain they are just giving a "bit more" for the continental heifers and steers, other plant operators are contacting farmers directly and offering to call at any time that suits the farmer - the changing faces of a multi-faceted industry.

Stock under 30 months are still in short supply and some fancy prices have certainly been paid. Agents report that 95p/lb was still widely available in the west, with 93p/lb being paid in the midlands.

One problem which has arisen at factory level since the start of the cull has to do with the paper work. Farmers who have completed the forms to have their cattle included in the cull are being urged not to remove the first sheet which is marked as the farmer's copy. This will be sent out to the herdowner by the factory once the cattle have been killed.

In Northern Ireland the trade has strengthened through the week due to tighter supplies. Quoted prices have increased by stg4p/kg to stg174p/kg excluding VAT (Ir97.4p/lb). However, because of the shortage of stock, there is a bit of dealing on price for lower grade stock. There are some indications that prices could rise by a further stg2p/kg over the next week.

Hogget prices come under pressure

By Declan O'Brien and Eric Donald

Sheep prices are certainly under pressure this week, with the trade easier in the marts and base quotes lower in some export plants.

Last week's factory base price of 140p/lb has been maintained in a number of plants but Slaney Meats and ICM Navan have moved to 135p/lb, while Kildare is working off of a base of 136p/lb. However, factories may struggle to get stock at the lower prices as numbers remain tight and farmers are in no hurry to sell.

Greater market resistance to the recent high prices has been blamed for the reduction. However, IFA Sheep Committee chairman, Frank Corcoran maintained that the price cut was 'unjustified'. The market in France was slightly easier this week with the average price for grade one lamb falling from 26 Ff/kg to 25Ff/kg. The SQQ in Britain was also back, falling from an Irish equivalent last week of 147p/lb to 142p/lb yesterday.

Ewes are scarce, with a lot tied up for retention, and this has resulted in a sharp lift in factory quotes. Prices range from 50p/lb at Kepak Athleague, to 53p at Slaney, 55p/lb at Ballyhaunis and Navan, 57p Kepak Hackettstown, and 60p/lb at Kildare Chilling.

There was strong demand for butcher hoggets in Roscommon mart with prices ranging from £18 to £22 along with the £1/kg. Prices for cull ewes were up on last weeks levels, and they made £40-£58 a head. Demand was particularly strong for the well fleshed ewes. Ewes with new born lambs at foot made up to £75 a head.

In Roscrea there were about 800 sheep on offer. Butcher hoggets made from "15 to £21 over, with one lot weighing 51kgs making £72 a head and another pen weighing 46kgs sold for £62 a head.

Cast ewes made up to £46 head, which was back on last week, but the quality of the stock was judged not to be as good. Ewes with lambs at foot are also starting to appear in the sales ring and one with three lambs sold for £110.