Tentative signs of a prices’ recovery as supplies tighten and demand increases

I’M in my local supermarket on Sunday morning, shopping list to hand. We tend to be a red meat family, but both chicken and fish also feature at least once a week.

So there was nothing unusual in the fact that I had an order for a cooked chicken. What I did find unusual was the price I was expected to pay – €5.25 for what in my mind appeared to be an awfully small bird.

It was so small I ordered a second one. Now I had €10.50 spent and that amount of money started me thinking.

Going to the pre-packed beef fridge, I picked up two strip loin steaks totalling €6.99, 750g of beef mince €2.89 and 410g of diced beef at €3 for a total spend of €12.88. Allowing that the steaks were a meal for two, the mince and the diced beef by comparison offered the potential for at least two full family dinners.

The mince alone would make enough for one family dinner with possibly enough left over to put in a small shepherd’s pie, while the diced beef was a family stew. Organised properly we’d be eating well for far longer on that €12.88 than the one dinner afforded us by those two €5.25 chickens

Now beef farmers may be wondering what this has to do with them, especially as base prices for bullocks and heifers remained set at €3.40/ kg yesterday.

However, my little exercise does show that at this time of unprecedented uncertainty beef appears to be the better option for the hard-pressed consumer when you compare its cost against other protein sources.

Little wonder then that the US

Department of Agriculture last week announced a $5.1 billion direct aid package for US cattle farmers. This is a considerably different approach than the market support measures such as Aids to Private Storage (APS) touted by the EU.

Returning to current factory prices, supplies have tightened with weekly kills now down to 25,000, but one procurement officer told me: “It’s no good. Half our customers are closed and that’s spelt CLOSED Martin.”

That said, there are reports that factory agents were more anxious for stock last week. While this is not the same as saying they were willing to offer more money, at least it is a step in the right direction.

Equally so was the comment from another factory agent who told me that there was a possible 5c/kg “squeak” in heifer prices, bringing them to €3.45/kg.

Prices for bulls also appear to edging in the right direction. While still generally beached at €3.40 for Us and €3.30 for Rs, I was also quoted €3.50 /kg and €3.40/kg although the same man told me Os were “difficult, maybe €3.20 for the better one.”

Cows also appear to be recovering with prices hardening around €2.90-2.80/ kg for Rs with Os on €2.60/kg and better P grades at €2.50/ kg. These prices are 5-10c/kg above where we were at Easter. Driving these improvements is the belief that demand for manufacturing beef may be about to increase.

While Supermacs is not McDonalds, its decision last week to reopen with a limited drive-through and delivery service does pose the question as to whether McDonalds and others will quickly follow suit.

Value:

Beef appears to be the better option for the hard-pressed consumer when you compare its cost against other protein sources.

There is a belief that demand for manufacturing beef may be about to increase