Anxious wait by farmers for factory prices on beef

REPORTS of up to 85p/lb being on offer for R grade bullocks will be put to the acid test today as producers anxiously await quotes for beef for the week from factories now that farmers have ceased their protests against prices.

This week, for the first time in six weeks, no farmer protest action is planned for the beef factories. It's the first of two weeks of a 'cooling period' in the IFA action over low prices for cattle.

Talks between farmers and processors on the price forward are already being underpinned by the IMA claim that "protests over the past five weeks have done severe damage to the industry", impeding their ability to service customers needs and restricting forward sales contracts, adding to industry difficulties.

They have again insisted negotiations on cattle prices can only take place between individual farmers and processor.

This leaves the IFA in a very difficult position as a negotiating body.

If numbers of finished cattle are back by 5,000 head per week average, as suggested by the CSO figures last week, over the coming weeks tighter supplies of cattle should secure higher returns for producers.

Supplies of cattle under 30 months are getting scarce, which should influence a rise in price.

But the bad weather will bring out whatever numbers are still in the system and this may lighten pressure on factories to pay more.

But there appears to be no shortage of over-age cattle ineligible for the UK market. They will have to find outlets in other, less remunerative markets.

Many producers have been holding onto these animals over August and September with the plentiful supply of grass and the good weather combining as a boost to increased weight gain. The gains compensate for some of the loss in thrive during the winter-like months of summer this year.

Factories have been discounting these animals by 2p-4p/lb, but producers hope the scarcity of young cattle will lift demand and prices on offer over the coming weeks.