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Factory demand for cattle is currently exceeding the rate at which supplies are coming on to the market.
Agents are contacting finishers, and in cases calling into yards, to enquire about possible numbers of cattle coming fit for slaughter. They are quick to act on any potential sales, with more and more reports of cattle being purchased on Wednesday and moving in the following day or two.
In other cases, there is a stalemate developing, with regular finishers in particular realising the balance of power is shifting. Factories are firm in their stance on price, but there are deals emerging which many buyers are trying to keep under wraps.
Steers are trading in the main on a base of €3.55/kg, but higher numbers are trading on a base of €3.60/kg as the week progresses.
Some plants are trying to purchase heifers from a base of €3.55/kg and again are willing to increase to a base of €3.60/kg to secure sales.
There are cracks appearing in factories which had previously moved to a base of €3.60/kg and were refusing to pay higher, with reports of larger batches trading on a base of €3.62/kg to €3.65/kg becoming more common.
Allowances are also being given in cases on transport costs, while there is also a reduced focus on carcase weights.
Demand is strong for Angus and Hereford stock, with numbers seasonally lower. Flat-priced deals for good O=/+ grading cattle range from €3.70/kg to €3.80/kg, while the top price continues to be paid in the northwest, with €3.90/kg to €4.00/kg reported for cattle securing a breed bonus and ticking all the boxes on weight, age and Chinese eligibility.
Upward movement in the bull trade is slow and variable, depending on how active the purchasing plant is for bulls. Regular sellers are in many cases securing an extra 5c/kg, with U grading bulls ranging from €3.55/kg to €3.65/kg.
Carcase weight limits are being enforced to varying degrees. The producer-processor relationship, the number of animals in the batch deemed overweight and the upper range in carcase weights are all influencing prices. Where penalties are being enforced, they are typically from 430kg to 450kg carcase weight.
R grading bulls range from €3.45/kg to €3.50/kg, with some producers negotiating flat-priced deals of €3.55/kg to €3.60/kg where the batch is mainly U grade bulls with a small number of R grades.
O grading bulls continue to record a wider price differential, ranging anywhere from €3.20/kg for plainer-quality bulls to €3.35/kg to €3.40/kg.
Demand for cows is firm, with P+3 grading cows trading anywhere from €2.65/kg to €2.80/kg, while O grades are trading from €2.75/kg to a top of €2.90/kg to €2.95/kg.
R grades continue to find it hard to progress above the €3.00/kg mark, with factories slow to increase to €3.05/kg to €3.10/kg.
British trade
Cattle supplies are reported as being tight in Britain. Average prices reported by the AHDB have eased after jumping over the Christmas period.
R4L steers average £3.41/kg or €4.02/kg at 84.8p to the euro and €4.24/kg including VAT at 5.4%. The R4L average heifer price is 2p/kg lower.
Quotes in Northern Ireland are firm. Opening U-3 steer and heifer base quotes range in general from £3.30/kg to £3.36/kg (€4.10/kg to €4.18/kg incl VAT), with returns secured by finishers trading at the higher end of the market rising to £3.38/kg to £3.40/kg (incl VAT €4.23/kg) for steers and 2p/kg to 4p/kg higher for heifers.
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