The beef trade is in a much better position than two weeks ago. Farmers have been under less pressure to move stock over the last 10 days and, as such, there is more appetite in the market, with factory agents having to work harder to source stock.
Independent plants with lower access to contracted or specialist-finisher supplies are the first to release the reins on price, with sellers with greater negotiating power securing an extra 5c/kg for heifers and steers.
This is witnessing base prices rise to €4.05/kg for heifers and €3.95/kg for steers. There are still significant numbers moving at a 5c/kg lower base, but sellers should note they have more bargaining power in negotiations.
Cows and bulls
The same can be said for cows and bulls, although factories are slow to increase prices.
Good-quality bulls less than 16 months and trading on the grid are selling from a base of €3.90/kg to €4.00/kg, with the higher prices secured by specialist finishers.
Some factories have relaxed weight restrictions and are paying the higher base to 420kg to 430kg to regular sellers, when previously the higher prices were limited to bulls delivering a carcase weight less than 400kg.
A similar situation is evident with bulls over 16 months but less than 16 months, with R grades ranging from €3.90/kg to €4.00/kg, while U grades range in price from €4.00/kg to €4.10/kg with some specialist finishers with good bulls on hand now pushing for 5c/kg higher.
Cow prices have also steadied. The general quote for P+3 grading cows remains at €3.00/kg to €3.05/kg, but prices vary 5c/kg to 10c/kg either side of this range.
Average prices for O grading cows range from €3.10/kg to €3.20/kg, but there are more sellers now pushing prices to the €3.20/kg to €3.30/kg range.
Likewise, R grading cows range on average from €3.35/kg to €3.45/kg, but agents purchasing for cow-specialist plants continue to pay up to 5c/kg to 10c/kg higher, while U grades range from €3.45/kg to €3.60/kg and a top price of €3.65/kg, with good-quality continental cows in tight supplies.
Numbers on the ground
Last weekend’s beef insights article showed some 37,059 extra cattle processed to date in 2018.
A portion of this occurred as farmers took steps to deal with drought conditions, but higher numbers have been coming on stream throughout the year.
Analysis of the latest Department of Agriculture AIM data for beef and dairy males and beef-sired females are detailed in Table 1.
As can be readily seen, there were over 50,000 fewer animals in the zero- to six-month age category on farms on 1 June 2018, which can, in turn, be directly attributed to live exports of calves rising by a similar figure.
This is in contrast with the 12- to 18-month age category, where there were 29,486 additional cattle on the ground.
A significant reduction in dairy-sired cattle is balanced by a similar increase in beef-sired cattle stemming from greater use of Angus and Hereford genetics on dairy farms. This is also underpinning the increase in heifers.
A lighter carcase weight of these additional animals will reduce the volume of beef coming on stream.
The 18- to 24-month age bracket shows 14,498 fewer cattle and this is partly influenced by a switch back to bull beef production, while there was 9,716 extra animals in the 24- to 30-month age bracket, many of which are likely to have been processed in recent weeks.
The key targets for maximising profits in a dairy calf-to-beef enterprise
Heavy bullocks and heifers a strong trade but plainer cattle a hard sell