Confidence among beef finishers is being hit hard by successive price cuts, with factories in the process of taking another 5c/kg off base prices this week.

Steers are being quoted a base of €3.75/kg, with heifers 10c/kg higher at a base of €3.85/kg. Prices have slipped by 15c/kg in the last three weeks or in the region of €50 on a 350kg carcase. There are still some finishers securing an extra 5c/kg, but the frequency of these deals is diminishing as the week progresses.

Factories are being helped in their efforts to pull prices by a continued rise in throughput. Last week’s beef kill increased by 1,002 head to reach 37,972.

The lift in throughput is stemming primarily from the cow kill rising 801 head to 8,284, with dairy farmers starting to cull cows in greater numbers.

Steer throughput increased by 169 head and is dominating the kill at 17,130 head.

The kill is running 2,470 head above (1,465 cows and 675 heifers) the corresponding week in 2017, with year-to-date throughput now running 40,275 head higher.

The downward pressure on steer and heifer prices is also transferring across into the trade for young bulls and cows.

Plants are trying to purchase R grading young bulls at a price range of €3.75/kg to €3.85/kg, while there is difficulty in pushing U grade bull prices above €3.90/kg to €3.95/kg, with some plants trying to quote €3.85/kg.

The higher prices are being secured by specialist finishers with higher numbers on hand and exclude producer bonuses.

Reports suggest that some factories have also become more restrictive around weight and age.

Bulls less than 16 months and trading on the grid are also now being quoted a lower base price of €3.75/kg, with some sellers still securing a base of €3.80/kg.

The extra 800 cows in the market is having a variable effect. Some plants are quoting 5c/kg lower for P+3 and O grading cows, with quotes of €3.00/kg and €3.10/kg respectively.

Prices for fleshed cows returning a carcase weight in excess of 280kg to 300kg are, in cases, securing an extra 10c/kg to 15c/kg.

Sellers should also note the potential deductions of upwards of €1/kg for poor-quality under-fleshed cows delivering a light carcase in the region of 200kg to 220kg or lower.

There is solid demand for good-quality cows, with R grading cows ranging from €3.30/kg to €3.45/kg, with heavy U grades low in number and rising to a top of €3.55/kg to €3.60/kg.

Stark contrast

The price pressure is in stark contrast with the North, where prices strengthened in recent weeks and are holding solid.

Most plants remain on a U-3 base quote of £3.54/kg to £3.56/kg, which equates to €3.98/kg to €4.00/kg at 89p to the euro or €4.20/kg to €4.22/kg including VAT at 5.4%.

Regular sellers continue to secure returns rising into the low-£3.60s, with heifers a slightly stronger trade and returning top prices of £3.67/kg to £3.70/kg (€4.35/kg to €4.38/kg incl VAT) to regular sellers.

The strength in the market also underpinned 415 cattle exported north for direct slaughter last week.

British beef prices also continue to rise on the back of prime cattle throughput reducing by 1,700 head to 27,498.

The AHDB reports an average rise of 1p/kg for steers and 2.6p/kg for heifers, with both R4L classes averaging in the region of £3.80/kg (€4.50/kg incl VAT).

Bull prices have lifted 3p/kg to average £3.62/kg (€4.29/kg) for R3 grades, while O+ grading cows are up 2p/kg to average £2.80/kg (€3.15/kg).

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