Low beef price not deterring sellers

THERE is optimism that beef prices may be about to stabilise after almost two months of price turmoil, during which profits were wiped out for most cattle farmers.

Quoted prices at the factories breached the 90p/lb or 252 cents/kg mark for R grade animals on Monday, after processors reduced prices by a further 6 cents/kg (2p/lb), offering 246 cents/kg (88p/lb) as the general rate throughout the country.

Prices for O grade animals were being quoted at 235 cents/kg (84p/lb), with some factories taking a further 3 cents/kg off to bring the price back to 232 cents/kg (83p/lb).

Nevertheless, supplies of cattle continue to flow to the processors, with no apparent resistance by producers, who seem to fear that the falling market of the past six to eight weeks hasn’t bottomed out yet.

The difficulty for producers is that processors are not interested in large supplies of cattle, because of market difficulties.

And with more cattle coming up to 30 months, they are under pressure to sell cattle if they are fit, to avoid the extra penalty of 6 to 9 cents/kg (2p or 3p/lb) for overage cattle, plus the cost of BSE testing.

With prices already well below the worst autumn expectations, it is going to be a difficult task for cattle farmers to achieve recovery in beef prices, unless there is a major change in the flow of competitively priced beef into the EU markets, to leave increased demand for Irish supplies.

At current prices, farmers who purchased store cattle this year are being hit by huge losses, which their EU Single Payments, due at the end of the year, may not fully cover.

There has been no change in the price of cull cows at the factories, with a base price of up to 191 cents/kg (68p/lb) on offer, and the quality cows making up to 28 cents/kg (10p/lb) more at the top paying factories.