Steady as she goes as heifer trade the big draw
The supply of cattle to beef plants has steadied — albeit as much as 20% less per week than a month ago — but processors are not willing to pay more to get extra stock out, except for some flexibility on heifers, for which the price premium over the males has widened further.
The margin between steer and heifer prices has expanded to a demand driven 25 cents/kg — probably the highest premium ever for heifer sellers.
Quoted base prices for heifers are 450-455 cent/kg (160p-162p/lb). Generally, processors are trying to buy within that range, but some farmers have reported deals at up to 460 cent/kg secured for good quality heifers. The quality assured bonus of 12 cents/kg added should bring returns to a decent level, but farmers should ensure they are being paid the higher QA bonus if their animals meet the qualifying criteria.
The steer prices are unchanged, with quoted prices of 430-435 cents/kg (153p-155p/lb). Some farmers are doing direct deals for up to 440 cent/kg for steers, but it is not generally available, and processors are holding a tight rein on steer prices, determined to stall any upward movement.
Intake last week was about 24,594 head, with the weekly supply now matching the corresponding week in 2012 for the first time in months. The year-to-date supply to factories confirms the stronger than expected flow up to recently, with almost 28,000 head more than last year gone through.
The scarcity of feed on farms, the high cost of bought-in feed, and the positive year-to-date trade for beef, have boosted throughput at the factories.
Cow prices are steady at 340-380 cents/kg, and a bit more for the quality heavier carcasses.
The beef trade in the UK was reported to have firmed last week, boosted by tight supply. Cattle prices firmed, with R4L-grade steers averaging equivalent to 487 cent/kg (174p/lb).
On the Continent, there was little change over the past week, with trade firm across most markets.
