98p/lb for Rs becomes the norm

BEEF cattle prices continued to improve at factories this week, as the trade continued at a pace not been matched for more than a decade.

Prices edged upwards by 3 cent/kg (1p/lb) at a number of factories, with the supply of bullocks on the decline as the trade moved into one of the most critical stages of the year, the gap between the end of shed cattle supplies and the first of the beef off the grass.

But there have been clear indications from processors this week that they are feeling the pressure of prices getting too hot, and looking at their options. Most of the processors have reduced their killing days, easing the pressure to maintain supplies. It is understood that a number of the factories have decided not to follow the prices any further upwards, and their procurement managers have been told if that they can't get the cattle, then leave them, but they are not to pay more than the quoted prices.

Farmers will, undoubtedly, see this as a ploy to take the heat out of the weekly price increase which farmers have come to expect at this stage. It remains to be seen what happens, and if the processors can make it stick.

The norm across the south and midlands this week has been quotes of 98p/lb for R grade stock. In the north west, R3 animals are quoted at 100p/lb, with 97p/lb for R4, and R5 over-fat supplies at 94p/lb. Quotes for O grades in the south and midlands are 96p or 95p/lb, with 97p/lb in the north west for O3, and 94p/lb for O4.

The total kill at the factories last week was 27,733 head, of which bullocks accounted for 13,198 head, a drop of 1,200 on the previous week, and 2,000 head less than the same 2003 week.

Cull cow prices are continuing at a very strong pace, with Slaney Foods at Freshford quoting up to 84p/lb for heavy carcasses which would have been a good price for steer beef last autumn and lighter cows at 82p/lb.

The demand for cow beef continues very strong, and supplies to the factories are running on a par with the same weeks in 2003, at around 5,000 head per week.

The warmer weather which has resulted in a surge of grass growth over the past week has brought about a further surge in prices for store cattle at the marts. Sellers can hardly believe the prices they are getting and buyers are willing to engage in a big gamble with the odds stacked against them for the autumn, when stronger supplies than normal, to avail of the last of the EU slaughter premia, could leave processors in a good position to recoup some of their 'lost' spring profits.