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Farmers attending the National Ploughing Championships commented on the negative affect recent reductions in the beef price is having on confidence in winter finishing.
With prices falling 10c/kg to 15c/kg in recent weeks and pressure still on the trade at a base of €3.70/kg to €3.75/kg, there is no doubting that factories need to at least stabilise the trade to go any way in starting to instil confidence in winter finishing.
Talk of a lower steer base of €3.65/kg is certainly not helping the mood in the sector. This is occurring mainly in the northwest, with many saying plants are taking advantage of the vulnerable position farmers in these areas find themselves in.
In the east and south, demand is stronger, with some sellers handling higher numbers and attracting competition from more than one plant commanding a base of €3.75/kg.
Higher steer throughput of 16,387 is the driver in last week’s beef kill rising to 34,556. Heifer throughput in comparison, at 7,606 head, remains steady and is responsible for heifers attracting more competition. The general base price being paid is €3.80/kg to €3.85/kg, although, as with steers, there is a small number of plants trying to quote a base of €3.75/kg.
Lower kill-out
Factory agents across the northern half of the country and along the western coast report cattle killing 1% to 2% lower than previous years, with fat cover also lower. This should be borne in mind when drafting cattle for slaughter, with stock falling into a fat class of 2= losing out on the 12c/kg QPS payment. Some farmers feel under pressure with cattle approaching 30 months of age, but they should also consider the mart trade as opposed to killing under-fleshed cattle.
Higher cow kill
The cow kill was recorded at 8,007 last week. This is over 2,000 more cows than the corresponding week in 2015, with the main difference stemming from dairy farmers moving cows earlier.
P+3 grading cows are trading from €2.80/kg to €3.00/kg, with fleshed O grading Friesian cows from €2.90/kg to €3.10/kg. Beef-bred O grading cows are capable of attracting a 5c/kg to 10c/kg premium, with R grades rising to €3.35/kg. U grades are also variable between plants, with prices ranging from €3.35/kg to €3.50/kg in plants very active in the cow trade.
Bull price pressure
Bull prices continue to be affected by price pressure on steers. R and U grade bulls are trading in general for €3.70/kg and €3.80/kg respectively.
Those trading at the higher end of the market are securing 5c/kg higher, excluding bonus payments, while plants quoting with little interest in bulls are offering €3.65/kg and €3.75/kg. Bulls less than 16 months are being offered a base of €3.70/kg. There are very few Friesian bulls in the market, with reported prices of €3.55/kg to €3.65/kg for O=/+ grading bulls.
Firm NI and GB trade
Northern demand remains firm, with last week’s kill steady at 6,155 prime cattle and 1,998 cows. Quotes remain at a U-3 base of £3.34/kg to £3.40/kg, the equivalent of €4.08/kg to €4.15/kg including VAT at an exchange rate of 86p to the euro. There is scope to negotiate higher, as demonstrated in LMC’s report of last week’s U-3= steers averaging £3.44/kg and heifers £3.48/kg. O3 grading cows are trading from £2.55/kg to £2.68/kg (€3.11/kg to €3.27/kg including VAT). British prices remain on an upward curve, with R4L steers and heifers ranging from £3.65/kg to £3.70/kg (€4.46/kg to €4.52/kg).
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