Last week’s 37,768 intake is a new peak for 2017
Cattle farmers continue to suffer a double whammy of bad weather forcing them to move livestock off the land, compounded by falling prices at the factories for beef cattle. After September rainfall as high as 183% of the long term average, according to Met Eireann statistics, land in many regions of the country has become water logged. Farmers have to choose between housing livestock or selling animals which are finished or nearly fit, leading to the recent peak weekly intakes at beef factories for the year to date.
Most processors have eased prices to a base of 370 cents/kg for steers this week. There are some deals at 375 cents/kg being negotiated, but the reality is that the weekly supply of stock to the plants is now exceeding requirements, and the factories are in a very strong position to dictate the price on a ‘take it or leave it’ policy.
Quoted prices for heifers are following a similar pattern, at a base of 380 cents/kg, and farmers struggling to negotiate a base of 385 cents/ kg.
Processors were fast to cut prices when when the sterling exchange rate hit 95p during the later summer months, but are still cutting prices now, after the recovery in sterling to 88-89p in recent weeks.
Beef finishers who held onto stock, when a steer base of 380-385 cents/kg was readily available, are now looking at taking less per head even though the cattle are heavier, and the finishers have incurred the additional costs of meal feeding in the meantime. It is going to take a tightening of the cattle supply to bring about a recovery in prices at the factories.
At this time of the year, there is always uncertainty about the supply going forward, and with in hindsight, predictions are rarely shown to have been correct.
Cow prices have also eased this week, across the range but more particularly at the upper level of the trade, which is not surprising when one observes that that the gap between prime R-grade beef and R-grade cows had narrowed to around 20 cents/kg. Base prices on offer for O/Pgrade cows are in the 305-310 cents/kg range in general, with the R-grade cows making around 330 cents/kg. There was a further increase in the weekly cattle kill last week, reflecting the pressure on finishers to move stock off wet land, with the total intake of around 37,768 setting a new weekly peak for 2017.
Total intake at the beef factories to the end of September was 5.6% up on the same period in 2016, with an extra 68,000 stock supplied. However, there are some variations within the categories of the kill.
While the supply of steers is 9.3% higher than 2016 (an extra 42,474 head), the number of young bulls is back by 9,819, which equates to 9.3% of a decline.
The number of heifers is up by almost 20,000 head, or 6.3%, and cow numbers slaughtered are 13,838 head higher, showing an increase of 5.3%.
Bandon lart store cattle show and sale Hereford/Angus cross heifer class; from left, Gavin Kiely, Skibbereen & Bandon Credit Union (class sponsor); winning owner John Lordan, Bandon; Sean lurphy, Bandon lart; and lary Crowley, Skibbereen & Bandon Credit Union.