Spell of weaker prices only a blip
Quotes from most of the processors were improved by 1 or 2p/lb on Monday, with the poorer grades showing the largest average increase, and a strong indication of more flat price purchasing.
The factories are quoting up to 95p/lb for good quality R grade animals and varying back to 93p/lb, which is an improvement of at least 1p/lb at all factories, and more at some of plants. The O grade stock are quoted at 92 and 91p/lb, an improvement of up to 2p/lb at some factories.
It has proved to be somewhat of a seller’s market this season, in sharp contrast to past years, and producers are now making a few bob of a profit margin on stock, which is very badly needed at farm level to restore some degree of confidence in spring finishing of beef.
While there has been much valuable work done by the processors in securing markets resulting in a good weekly demand for beef , the principal reason for the current positive run which is benefiting farmers is the shortage of stock for slaughter.
The recent increase in supplies, which led to easing prices over the past fortnight, was short lived.
Now, processors are complaining bitterly that they are suffering a squeeze on profit margins, and there are reports of some processors maintaining their operations out of beef reserves, to hold onto markets, rather than go into the cattle marketplace.
Throughput at the factories last week was 28,106 head, compared to 32,340 head for the previous week, but account must be taken of the shorter week due to St Patricks Day.
The steer kill was 15,296, down from 17,945 head the previous week.
There is a market for over 18,000 steers per week. It is not until supplies exceed that level that there is any threat to the price at the factories.
The odds appear to favour farmers for prices to hold firm for the remainder of the season, as any significant increase in supply appears unlikely.
The trade for cull cows continues firm. Up to 76p/lb is quoted for heavy cows and up to 83p/lb is being paid by the top factories, which is slightly down from the peak prices which had been paid in recent weeks.
