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The coronavirus pandemic is leading to beef sales meeting hugely contrasting fortunes. On the one hand, fresh meat sales are booming, with factories increasing output in a bid to keep supermarket shelves stocked amid panic buying.
Factories are trying to maintain normal throughput and at the same time adhere to Government recommendations.
Some are working longer or staggered shifts to maintain throughput, while a number of plants operated a small kill or had boning and packing halls working at some levels of activity on St Patrick’s Day.
The higher demand for fresh meat sales is leading to factories prioritising throughput of steers and heifers. The trade has eased 5c/kg in cases over the last week to 10 days and is now holding steady.
Steers are trading in the main on a base of €3.65/kg, with some deals completed on a base of €3.70/kg.
Likewise, many factories have pulled heifer quotes back to a base of €3.65/kg, with select deals again completed 5c/kg higher. Some agents think supplies are not overly strong, but report that producers keen to move stock boosted market numbers in recent days.
Food service sales, which incorporate trade avenues such as restaurants, hotels, cafés and fast-food outlets, have recorded a sharp drop-off in sales. Restaurants and hotels are particularly hard hit. This has led to a sharp drop in demand for cows and cattle deemed out-of-spec.
This is also starting to feed into lower demand for young bulls and heavier-carcase steers, with lower demand for large striploins and roasting cuts. Many plants are now starting to prioritise carcases less than 400kg carcase weight and in cases penalising those over 420kg by 5c/kg.
Quotes for cows have fallen anywhere by 10c/kg to 20c/kg. Many producers with cows on hand are meeting an increased lead-in time from booking to slaughtering.
P+3 grading cows are averaging €2.90/kg, with O grades ranging from €3.00/kg to €3.10/kg. R grades are also reported as easing back to a range of €3.20/kg to €3.30/kg.
Demand for young bulls is being helped somewhat lower throughput
Prices have eased by 5c/kg in cases, or more where producers do not have a good relationship with factories or have bulls that are deemed out of spec.
U grades range from €3.60/kg to €3.70, with R grading bulls from €3.50/kg to €3.60/kg on average. As mentioned above, the carcase weight of bulls is now having a greater influence on price, as is the producer-processor relationship.
O grading bulls range anywhere from €3.25/kg to €3.45/kg, with flesh cover and quality having a major effect on price.
Prices in Northern Ireland are steady, with base quotes continuing at a range of £3.30/kg to £3.34/kg on average. The value of sterling to euro fell to 92p on Wednesday morning, which equates to €3.59/kg to €3.63/kg and €3.78/kg to €3.83/kg including VAT at 5.4%.
Coronavirus precautions
There is no reported factory closure due to coronavirus, but the virus is causing significant disruption in other ways.
Factories have moved to reduce their physical interaction with producers and in turn reduce the risk of the virus spreading.
Most factories are asking producers not to exit their vehicle when delivering cattle, while mart facilities such as the canteen or gaining access to procurement staff offices are strictly off limits.
This is a necessary move to protect all involved and hopefully maintain processing.
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