Factories keen on ‘supermarket’ beef as food service demand goes into freefall

WITH McDonald’s closing all their restaurants in Ireland and the UK, the Covid-19 virus outbreak continues to hit home.

This is a serious blow to the beef trade, particularly the Dawn Group, who are a major supplier to the fastfood chain.

There will be a ripple effect across the entire Irish beef industry in the short to medium term, to add to all the other bad news of the last week as the hotel, pub and restaurant industries across Ireland and Europe were forced to shut up shop.

In real terms, what the factories have left is the supermarket trade.

People still have to eat, so with restaurants and most takeways closing, the appetite of nations will now have to be catered for mostly by the domestic kitchen.

My sources tell me factories are keen for “supermarket beef” with the emphasis on Angus and Hereford types plus your lighter 280-330kg continental heifer.

This also means that once again the trade is turning its back on heavy cattle or anything out of spec.

So where are we on prices? Anything bought in advance from last week on the bullock side appears to be operating from €3.60-3.65/ kg, with heifers 5c/kg better at €3.65-3.70/kg.

However, as this week progress the expectation is that both bullocks and heifers will ease back to no better than €3.60 and €3.65/ kg respectively.

After their fall of 20c/kg two weeks ago cull cows steadied last week, with O-grades at €3/kg and better P grades on €2.80-2.90/kg. However, there is now an expectation that cow prices may take another hit.

Trade for bulls also steadied last week, with U grades at €3.60/kg and R grades remaining at €3.50/ kg, both prices dependent on overall cover.

O-grades varied, with continentals floating around the €3.40/kg mark, while some Friesian O-grades were little better than cow price at €3.20-3.30/kg.

At this time it seems

The McDonald’s announcement will have a ripple effect across the entire Irish beef industry

inappropriate to ask the question, yet it has to be asked: in the light of the supports being given to other sections of industry is there room in the equations of Government or the EU for some sort of direct farmer support at this time for those caught with cattle to kill?

Is there a possibility that meaningful supports will be given to the industry as a whole?

One factory agent I spoke to said: “In 2018 we had a drought, then last year farmers shot themselves in the foot with the protest, and now this. When will it end?”

Good question.