Factory bosses are playing hardball on beef prices
Steers Heifers Cull Cows Young Bulls THE CLIMB in factory beef prices appears to be over, for the present at least. The factory bosses, like some football and hurling managers over the weekend, seem to have got their act together on pricing.
Starting last Thursday, lists of “new” prices appeared that were effectively 10c/kg less than what had previously been in circulation. Further to this was added the good footballing philosophy of moving as a team, with ‘no solo runs lads’.
What it means in terms of pricing is that as of yesterday morning the bullock seems to have been cemented into a reduced price of €4.05/kg for a run of general steers with maybe a bit of €4.10/kg about if the quality and numbers were right.
It’s similar with heifers — they are back from their high of €4.25-4.30/kg two weeks ago to €4.20 for the better continental while your Hereford, Angus and Friesian has been pushed on to a base of €4.15/kg.
Moving to the bulls, the base price for under 16-month stock falls back to €4.05/kg this week with a “possibility” of €4.10/kg “maybe”.
Bulls up to 24 months are also back this week with some plants quoting as low as €4.00/kg for Us with Rs on €3.90 and Os back at €3.80/ kg.
Other plants are 10c/kg better at €4.10 for Us with Rs on €4.00/kg but even here the O grade is on €3.80/kg.
Cow prices took a hit last week as factory bosses began to get their plans together and this week the pressure remains on R grades which are on €3.60/kg.
The O and P grades see an opening range within their respective grades.
While some plants were quoting €3.40/kg for Os yesterday, others were back at €3.20/kg with the same scenario for Ps — the top in one place being €3.30/kg while down the road it might only be €3.10/kg.
Opinion on whether the processors can make this price pull stick seems divided, with some commentators, including the IFA’s Angus Woods, arguing that cold stores across Europe are effectively empty.
Others point to the fact it is only mid-June and when you take the cows out of the equation, heifers and bullocks cannot appear in big numbers because they haven’t got the thrive done.
Other sellers, with possibly one eye on the cheaper economics of grass fattening, seem to be more accepting of where factories want to push prices.
Flushing
There may be an element of “numbers flushing” going on given the time of year. The price of those O grade bulls at €3.80/kg —almost 20-25c/ kg below the prices from a few weeks ago —shows that despite strong cow throughput, factories want more manufacturing beef than they are getting and are tailoring their overall pricing structure accordingly.
Angus Woods has drilled down into the figures for prices, weights and numbers and has come up the following conclusions. — UK prices are currently at euro equivalent €4.48/kg —a full 48c/kg ahead of this time last year. — Irish slaughterings are running 30,207 ahead of last year, yet in the first four months of the year steer weights are 9.6kgs less than for the same period last year.