Low supply sees dramatic rise in mart price for over 600kg

Steers Heifers Cull Cows Young Bulls WATERFORD’S tidy seven-point victory over Clare will no doubt feature in the conversation pieces used by many factory agents as they go about their business of securing ongoing beef supplies from an increasingly diminishing pool of bullocks and heifers.

With base prices of €4.10/ kg for steers and €4.20/kg for heifers now generally accepted across the country, I expect the factory agent who told me that he can’t officially quote anymore than €4.00 and €4.10 respectively will have his work cut out, even if he does genuinely believe that Waterford are All Ireland contenders.

That diminishing supply pool has seen a flurry of activity in cattle marts across the country in the last week as factory agents clashed.

The result has been that the mart price for the over 600kg steer and heifer has risen quite dramatically in places. The ringside report shows those heavy bullocks up by €36/hd on average, while the over 600kg heifer is up by €54/hd, with the top end heifer up a whopping €144/hd.

The cull cow trade has also had a flyer of a week with mart managers telling me that the better finished heavy cow is now making €2.20/kg, and €2/kg now a minimum for the better conformation cow.

This extra mart activity underpins the theory that suitable stock for the factory are in short supply.

Although supplies of cull cows are now running 500hd over of last year’s figures on a weekly basis, it’s not enough to keep up with the shortfall in bullocks, which are down 2.5pc. Heifers are also down marginally.

So while some have attempted to talk down the cull cow price by about 5c/kg on the strength of their rise in numbers the reality is there is no change with prices steady at last week’s levels of €3.70/kg for Us, €3.60/kg for Rs, €3.40-3.30/kg for Os, and Ps on anything from €3.30-3.15/kg, with deals on combination loads sweetening the price of the lesser conformation animal.

The only fly in the ointment is that as the supply of young bulls continues to run well ahead of last year’s figures, up 31pc year on year.

As a result prices are not quite at last year’s levels for young bulls, with €4.25/kg in June last year for Us compared to this week’s quotes of €4.054.10kg for the same grade. But given the increase in supply, it’s not a bad result. Rs and Os are also unchanged this week at €4.00-4.05/kg for the R grade, and O’s on €3.85-3.90/kg.

On the issue of quotes I see that the North’s Livestock and Meat Commission has produced some very interesting data on beef factory quotes versus actual prices paid.

They looked at 1,913 R3 grade in-spec steers killed this year, stripped out any bonuses paid under the Angus, Hereford or organic schemes and compared the official quoted price for that week with the actual price paid.

The results show that in any given week the actual price paid was on average between 4-8p/ kg higher than that quoted.

Take into account that some animals were bought and paid for at the actual quoted price you can work out that some suppliers got more than that 4-8p/kg bonus.

This of course raises the question why farm organisations in the south have not been able to get factories to officially quote in the beef sector; after all it causes no issues in the sheep sector.