Tighter supplies of stock for the factories has boosted the trade for the opening days of the new year, with an all round improvement in the prices on offer for cattle.
Despite the strong intake during the final weeks of 2012, demand for cattle the factories opened very strongly when the beef business returned to normal this week, with factory agents busy in all areas of the country.
The quoted prices are improved by 15-20 cent on pre-Christmas, and farmers are in a strong position to secure above the quoted prices for stock this week.
Base prices being quoted for steers are from 405 to 415 cent/kg in general, with up to 420 cent/kg at some factories. Very few steers are being bought at the lower end of the scale, with the general run making 410-420 cent/kg, and most agents are finding it difficult to source sufficient supplies.
The base price for heifers is from 425-430 cent/kg. Most of the heifers are being purchased within that range, but some farmers have reported up to 435 cent/kg being secured for quality lots of heifers.
These price improvements are slightly stronger than they appear — because of the change in the flat rate VAT. On Jan 1, the flat rate VAT refund to farmers was reduced from 5.2% to 4.8%, as announced in the December budget.
Large supplies of finished cattle were offloaded by farmers during December. The intake for the three weeks up to Christmas was the largest for the year — a very unusual feature of the 2012 trade — and well ahead of the same weeks in 2011. There was a fall off in supply during the final week of the year. However, the strong depletion of supplies has contributed to the improved market now for those who held onto cattle.
The price increase of €60 to €75/head since before Christmas is very welcome for these sellers.
The supply last week was about 23,480 head, almost similar to the same week in 2012.
There is also an improved trade for cows at the factories this week. Base prices on offer for O/P-grades are 330-360 cent/kg, with the heavier R-grade carcass worth up to 380 cent/kg. There is strong demand, for the quality cows in particular.
The beef trade in the UK is reported to be holding similar to previous weeks, with demand remaining firm. Trade is being helped by on-going tight supplies. Cattle prices firmed during the past week, with R4L-grade steers averaging equivalent to 480 cent/kg.
On the continent, the beef trade is reported firm across most of the key markets, helped by some restocking after the festive period.
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