Thursday, February 09, 2012
Official quotes have been reduced as much as 5 cent/kg (2p/lb) again this week at a number of factories, but the flow of cattle has tightened.
It’s hard to tell who’s winning and who’s losing in the ongoing market battle.
Base prices for steers are quoted at 390 to 400 cent/kg (139p-143p/lb) for this week. Most are being bought at 395 to 400 cent/kg. Heifer prices — both quoted and actually paid — are generally 5-10 cent/kg higher than for steers. Some farmers report selling very good quality steers for a shade over the general run of prices, but the scope to get a top-up for heifers appears to have tightened.
Intake last week was about 26,526 head, slightly down from the previous week, and more than 3,000 down from the same week in 2011. At this level of supply, farmers should be in control of the market — so processors must be concerned about the consequences of any further decline in supply, with no signs of recent cuts in quoted prices leading to panic selling of cattle. Instead, if continued downward pressure on prices leads to a further decline in supply, getting the weekly intake up again could prove expensive for processors.
A very positive omen for cattle farmers is the stability of the trade for cows. Demand continues very strong and the prices are nearly unchanged. The base for O/P grade cows is 325 to 350 cent/kg (116p-125p/lb), and up to 360 cent/kg (129p/lb) is still being achieved for the better quality heavy R grade cows this week.
The beef trade in the UK showed very little change over the past week. Cattle prices are virtually unchanged, with R4L grade steers averaging equivalent to 454 cent/kg (151p/lb).
On the Continent, the trade is relatively steady, reflecting on-going tight supplies across key export markets.
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