Cattle price pressure is 'opportunistic'
Factories are trying to apply even more pressure on prices, a move that is being criticised as opportunistic by the IFA.

Beef quotes on Friday show factories trying to implement further reductions on steer and heifer base prices.

Some factories are trying to reduce the base price for steers to €3.95/kg and for heifers to €4.05/kg, for cattle changing hands next week. This follows a 5c/kg reduction earlier in the week, with steers reducing from €4.05/kg to €4.00/kg, and heifers from €4.15/kg to €4.10/kg.

The price pressure has been criticised by IFA livestock chair Angus Woods, who described the move by factories as “opportunistic”.

“Feeders should strongly resist any price pressure from the factories,” he advised. “There is no beef in store and market demand remains strong.”

Woods is calling for Minister for Agriculture Michael Creed to react.

“There is no market basis or justification for any reduction in cattle prices,” he added. “

In the last week, Bord Bia has highlighted the very strong beef market returns for factories in 2017 and the extremely strong returns on offal and hide values.

“Minister Creed needs to call an immediate beef forum and make it abundantly clear to the factories that they must return a fair and viable price to farmers.”

He also pointed to steady prices in our main export markets as providing an opportunity for higher prices to be returned to Irish farmers.

“Over the autumn, UK beef prices have remained very strong and EU prices have strengthen significantly, up 30c to 40c/kg on previous year levels,” Woods said.

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Monday trends update: spotlight remains on bull processing delays
Finishers continue to face challenges in getting bulls accepted for slaughter in significant numbers, while the threat of bulls going overage and being deemed overweight is increasing the gravity of th

Young bulls remain at the centre of beef processing challenges.

Finishers are encountering difficulties on three fronts – getting bulls accepted for slaughter in significant numbers, moving bulls before they go overage and dealing with penalties imposed on what factories deem out-of-spec stock.

Processing delays

Starting with processing delays first, the higher number of bulls in the market, combined with reduced appetite from processors, is witnessing finishers contending firstly with getting bulls accepted for slaughter and then, in many cases, moving bulls in much smaller numbers.

Reports are common of farmers with anywhere from 40 to 100-plus bulls fit for slaughter working to a booking timeline of getting single digit numbers moved on a weekly basis.

There has also been an increase in farmers practising a bull finishing enterprise

The Irish Farmers Journal has also been contacted from a number of producers citing Foyle Meats concentrating on cattle that fit their new grid specification as leaving them needing to find a new home for bulls.

There has also been an increase in farmers practising a bull finishing enterprise, particularly with Friesian bulls.

Some of these bulls are not hitting desired fat scores and also risk going overage in the coming weeks, which is intensifying the uphill battle facing these producers.

Variable prices

Prices reported this week are also more variable.

Specialist finishers working closely with factories are still moving bulls on a general quote of €3.70/kg for Rs and €3.80/kg for U grades.

Bulls deemed overweight are facing cuts of 10c/kg, with the carcase weight limit kicking in anywhere from 430kg to 450kg on average, while some finishers are negotiating higher limits.

Cuts faced for bulls exceeding the 24-month age limit have been reported at 10c/kg to 15c/kg, with this also influenced by the numbers involved, processor-producer relationship and the finishing spec.

Off the grid

Bulls less than 16 months and exceeding a carcase weight of 420kg to 430kg are also being paid off the grid in many cases, with those hitting required spec generally trading on a base of €3.75/kg.

Friesian bulls are trading on average for €3.50/kg for good O grading bulls, with O- grading bulls and those lacking flesh selling 10c/kg to 15c/kg lower.

Steady steer and heifer demand

Factories remain keen for steers and heifers, with base prices now unchanged since October at €3.75/kg for steers and €3.85/kg for heifers.

Prices are running about 15c/kg to 20c/kg behind the corresponding period in 2018 when there was a dip in the trade from mid- to late January.

The cow trade is steady, but at a low level, with prices running as much as 40c/kg to 50c/kg behind comparable 2018 levels.

P+3 grading cows continue to average €2.60/kg to €2.70/kg, with O grades from €2.80/kg to €85/kg, while R grading cows range from €2.95/kg to €3.15/kg, with carcase weight having a significant influence on prices paid.

Likewise, U grading cows range anywhere from €3.20/kg to €3.40/kg, with firm wholesale demand and small numbers of top-quality cows helping to keep a firmer floor under the trade.

NI trade solid

The northern trade continues as is, with U-3 base quotes for steers and heifers ranging from £3.36/kg to £3.44/kg.

This equates to €3.82/kg to €3.91/kg at Monday evening’s exchange rate of 88p to the euro and €4.02/kg to €4.12/kg including Vat at 5.4%.

The potential for regular customers to secure higher than quoted prices has been highlighted in a report by the Livestock Meat Commission (LMC), which shows that, since September, finishers secured a premium ranging from 4p/kg to 11p/kg above base quotes.

This trend remains, with specialist finishers pushing top prices for steers to £3.50/kg, with heifers in cases breaching the £3.50/kg mark at the top of the market.

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Video: Sheplands Farm suckler dispersal sale report
Adam Woods went along to the Sheplands Farm suckler dispersal sale on Wednesday to check out the trade for suckler cows. Watch here.

A massiive crowd packed into the small ringside at Leinster Marts Kilcullen last Wednesday 16 January for the dispersal of the Sheplands Farm suckler herd.

The herd was managed by Heinz Eggert and the farm had been a previous participant in the Teagasc/Irish Farmers Journal BETTER farm beef programme.

The sale included 89 spring calving cows, 11 in-calf heifers and four pedigree stock bulls. Having been established in 1990, breeding was dominated by the use of bulls with high milk and fertility traits while keeping a focus on good conformation and good functionality.

Heinz had worked with mostly Limousin genetics during this time, with weight gains in calves and stock performance having been maintained at very high levels over the years.

Docility was also a major focus for the herd.

The herd was vaccinated for BVD, Lepto and Salmonella and was TB-free for the last 12 years. The herd had a very high replacement index at €128, with cows as high as €220 included in the sale.

First-calving heifers' average replacement index came in at €160. Average calving interval for the herd was 359 days. Cows were in-calf to Simmental, Limousin and Hereford stock bulls and were calving in February, March and April.

Trade was brisk, with the average price for the herd coming in at €1,410, which was very good for 100 animals sold.

Three- and four-year-old cows made from €1,600 to €1,800. Older cows were easier sold, making between €1,300 and €1,500.

Eleven first-calving heifers all calving at two years old averaged €1,310.

Speaking after the sale, herd manager Heinz Eggert said it was tough to see the herd being sold but was very happy with the prices, especially for some of the very high-index cows. The farm owners are yet undecided about what they will do with the farm but are currently exploring opportunities around contract-rearing.

What's on in the marts?
Your guide to what's on in the marts across the country in the coming weeks.

Carnaross

  • Thu 17 Jan: Dairy sale.
  • Tues 29 Jan: Clearance sale of 52 Limousin-Charolais-cross spring-calving cows.
  • Headford

  • Sat 19 Jan: Wanted – Angus bullocks and heifers for feedlot, can be purchased by weight.
  • Tullow

  • Fri 25 Jan: Male fatstock show and sale.
  • Friday 1 Feb: Female fatstock show and sale.
  • Carrigallen

  • Sat 26 Jan: Sale of 34 young dairy cows at 1pm.
  • Gort

  • Thurs 31 Jan: Special monthly continental weanling sale.
  • Carlow

  • Mon 4 Feb: Show and sale of weanlings, cull cows, suckler cows and bulls.
  • Mon 11 Feb: Show and sale bullocks and heifers.