There is a brighter outlook for beef producers this week with positive signs that the trade for finished cattle has finally turned the corner.
It is a long time since the combination of increased consumption of beef and tightening supplies of finished cattle has come together to drive the price to producers, which appears to be the driving force this week.
There has been an all round increase of 5c-10c/kg in the prices being paid for steers and heifers at the processors and the signs for the coming weeks are much brighter than they have been for a long time.
There is an old belief in the beef trade that “the factories only pay for cattle when they can’t get enough of them” and in a strange way that appears to be holding true for the trade this week.
IFA beef chairman Brendan Golden has pointed out how the market for beef has been changing. Consumption of beef on the home market show that the volume was up 14.9%, with mince sales up 26.1% and steak sales up 15.2% for the four weeks to mid-April which confirmed a significant change.
In the UK, which continues to be the main export market for the Irish beef sector, retail sales for the same period showed beef volumes up 16.2% and spend up 15.3% while sales of mince were reported up 27% and steak sales up 10.8%.
At the same time the supply of cattle to the Irish factories has been falling sharply to a base of around 25,000 head per week, a drop of over 10,000 head/week on the earlier Spring figures.
As a consequence the general base for steers has increased to 350c/kg. Processors offering a base of 345c/kg this week are realising that it is waste of time, because harder selling poducers are insisting on getting a base of 355c/kg before selling.
There are some reports of 360c/kg being achieved for steers, which, if correct, may be an indication of where this market is now heading.
The heifers are generally 5c/kg stronger than the steers with the top of the trade hitting 365c-370c/kg.
The rising trade has lifted all categories and the prices for young bulls are closing in on the steer price this week, while the cow trade has edged upwards to 310c/kg for the good R-grade cows.
The O-grade cows are on 280c-290c/kg and P grade are in demand at up to 265c-270c/kg with the overall improvement in the beef trade having lifted prices across all categories.
The intake at the factories last week continued on par with recent weeks at 25,947 head. The steers at 9,859 head were slightly higher than the same week last year while heifers at 7,955 head were back 1,300 head on the 2019 level.