Cull cow prices at a five year high

Export demand adding 30c/kg

STRONG export demand for manufacturing beef has boosted cull cow prices to a five year high.

Year on year the prices have surged by 30c/kg, while the supply of cows to the factories hit an 18-year high last year.

Prices have continued to surge upwards into 2018 as during the first full week trading in February figures show individual factories have paid up to 385c/kg for U grade cows.

A buoyant cull cow trade in the marts has seen feeders pay over €1,000/hd for good quality Friesian stock.

Joe Burke of Bord Bia said the high cow prices confirmed the strength of the manufacturing beef market.

The vast majority of cow beef goes for burgers and mince, with sales generally less susceptible to the seasonal highs and lows which impact on demand for the higher value steak cuts.

Mr Burke said the stewing beef market in Holland and other northern European countries was another important outlet for cow beef, with the recent cold snap across Europe helping sales on this front.

Mart managers maintain that nice dairy cows weighing around 630-650kg are freely making €950-1,000/hd.

Young cows from the dairy herd are freely making €300 with the weight, and more has been paid for well fleshed animals.

The trade is being driven by competition between farmer finishers and factory agents.

“A lot more farmers are coming into the cow market,” said Tom McCarthy of Bandon Mart.

“Cows are more plentiful and there is strong factory demand for the finished animal,” he explained.

Mr McCarthy said the bulk of the dairy cull cows were making €200-350 with the €1/ kg, but cows that were close to finishing could make up to €500 with the weight.

Jim Bushe of New Ross Mart said the Friesian cow was an increasingly important segment of the overall beef industry.

He maintained that the strength of the trade was reflected in the prices paid for poorer quality stock.

Supply

Prices reported to the Agriculture Department show the national Irish average for O3 cows over the month of January 2018 was 344c/kg compared to 314c/kg for the same grade over the same month in 2017. There was a similar difference in the P3 price.

The supply of cows remains strong, with 7,488hd processed in the week ending February 10.

A total of 372,891 cows were processed at the factories in 2017, the highest annual kill since 1999.

While average carcase weight has increased, grades have disimproved.

The percentage of R grade cows in 2017 was 13.6pc of total intake compared to 15.9pc in 2016. O grade dropped from 33.5pc to 32pc.

R grade average carcase weights for 2-/4= increased from 316kg in 2016 to 367kg in 2017 and there was a similar increase in U grade average weights.