Cattle trade can baffle even the experts
THE OBSERVATIONS of auctioneers can give a good insight into the psychology behind some cattle buyers’ purchasing decisions.
“If it was all about the money and certainty they’d sell the farm and bank the money,” was the opinion of John Curran of Carrick-on-Suir Mart on the cattleman’s never-ending battle with market forces.
Another auctioneer, who wished to remain nameless, told me that “a lot of men appear to be operating on a budget. They might want to buy the 450-550kg bullock but once the price moves up they fall back and are buying lighter, cheaper stock.”
Looking at last week’s Ringside figures we see that the lighter 300-399kg bullock dropped back 5c/kg on average to €2.59/kg, while better made comrade at this weight rose 4c/ kg on average or from €12-16/ hd to €2.96/kg.
That’s a 37c/kg difference in price between the average and top conformation bullock at this weight or from €111-€148/ hd, while the difference from top quarter to bottom quarter is more than twice that at 79c/ kg which translates into a difference of €237-€315/hd.
In the 600kg+ forward store/ factory bullock category, the price differences drop to less than half this level.
The overall average is €2.24/ kg, while the top quarter is just 16c/kg stronger at €2.40/ kg, with the bottom quarter at €2.06/kg.
In prices per head, the overall average is €1,344/hd; the top quarter average is €1,440 and the bottom quarter average is €1,224/hd.
How do you explain the difference in the figures for those lighter cattle of €237-315/hd as opposed to the finished animal’s price spread of just €216/hd top to bottom? I am at a loss to know.
One possible reason is that those doing the buying at those lighter weights just don’t realise that when their newly bought stock turn into factory cattle the margins get an awful lot finer.
There are other sums that can be done on where money is being made or lost up and down the tables but in the final analysis the cattle trade is, to paraphrase Winston Churchill’s analysis of Russia, “a riddle wrapped in a mystery inside an enigma”.
Just for the record, that 600kg+ bullock fell 1c/kg last week which in effect sees his price remain stable, while at the same time the recent positive moves in factory prices saw the poorer conformation animal at this weight gain 1c/kg.
I wrote last week that I was not prepared to read too much into a 3c/kg fall a fortnight ago in prices across the 400-499kg and 500-599kg sections.
So it has proved with the overall averages in both remaining unchanged, but significantly the bottom quarter in both weight divisions bounced back by 4c/kg or from €16-24/hd, leaving them improved overall when averaged over the two weeks.