Processors won’t budge on quotes despite the very low kill figures
There is little good news from the factory trade for those in the fattening game despite kill figures remaining very low, 25,129 for the week ending April 24.
Tentative signs two weeks ago that base prices for bullocks and heifers might be about to rise have so far failed to materialise every factory agent I spoke with over the weekend continued to quote a base price for bullocks and heifers of €3.40/kg.
This is a short working week so a lot of what will be required was probably bought last week, meaning that factories are under little pressure to source extra supplies.
The position of the factories on price is simple: until British and EU markets re-open fully they will continue to struggle to move what they are currently slaughtering.
Yet the European Commission Observatory report for the week ending April 24 shows the average price of U+R+O grade steers in Britain and Northern Ireland being significantly ahead of here.
The average of the three grades combined in Britain is reported as 375.96c/kg, with Northern Ireland averaging 370.98c/kg, while the Irish equivalent works out at 346.33c/kg.
The average for France is not as promising at 336.20c/kg. Yet behind that combined figure, French U-grade steers averaged 376.44c/kg.
I grant you it’s not simple at present with the lockdown continuing in some shape or
Steers Heifers 340 340 340 340 form across the continent and in Britain, but speaking with finishers there is also growing anger towards the farm organisations as well as the factories.
With the reduced influence of the Beef Plan Movement, those with cattle to kill are now once again reliant on the IFA and ICSA to ask the hard questions.
So far, however, neither appears to have been effective in getting across the message of where beef finishing is currently at in this country.
If the price paid to Irish producers does not dramatically improve, there is the spectre of Irish beef production winding down to the point where imports from Poland into the British supermarkets becomes the norm rather than the exception.
Returning to prices, factory quotes for young bulls were yesterday back 5c/kg to €3.403.45/kg for U grades, with Rs once again on €3.30-3.35/kg, while O grades are at €3.20/ kg.
With the market depressed the problem of getting a plant to actually take cattle also remains.
The only positive I can pick out concerns cull cows, with their prices hardening around the €2.90/kg mark for Rs, with O grades edging towards €2.70/kg, while better Ps move up slightly to €2.50/kg.
For those who specialise in cull cows I’m told that a “shade” more is possible for well-fleshed types.
So the manufacturing side of 340 the processing sector’s business remains the one area where supplies appear to be needed, with your cull cow the cheapest option.
In the US, underlining how important continuity of supply is to the security of that nation, President Donald Trump last Tuesday signed an executive order under the Defence Protection Act designating meat production plants as critical infrastructure and ordering them to stay open despite concerns about the spread of Covid-19 among workers.
This is the same act that allowed Trump to direct General Motors to increase production of ventilators.
Every factory agent I spoke with continued to quote a base price for bullocks and heifers of €3.40/kg