Beef market report: 360kg steer now worth €350 more in the UK

Farmer expectations of stronger beef prices at the factories this week were no more than wishful thinking.

Unchanged prices was the best on offer from the processors.

The supply of cattle to the factories continues strong.

So Irish processors are not under pressure to get sufficient stock to fill market requirements.

They can continue to ignore farmers’ demands for better prices to close the gap between Irish and UK prices — a gap which widened further over the past week.

The base price for steers has continued at 410 cents/kg, with a minority of suppliers negotiating deals for a few cents more.

The base for heifers continues at a premium of 5-10 cents over steer prices, delivering 415-420 cents/kg.

Similar to the steers, a small percentage of farmers are negotiating a few cents more.

There are no indications of any upward movement in beef prices in the offing.

The supply last week remained strong at around 31,350 head, with finishers continuing to move out stock as they become fit.

The current returns are leaving finishers with tight profit margins; it looks like last year’s factory gate protests, and the Beef Forum, haven’t changed much.

Over three weeks, the Irish R3 steer price has dropped by 4 cents/kg, while in the UK, the price for the same animal strengthened by 17 cents/kg.

The heifer price in the UK increased by 19 cents/kg, while the Irish price slipped by 6 cents/kg.

Processors can point out that prices in the UK are not mirrored in the broader European markets, but close to 60% of Irish beef exports are to the UK, and the high return from that market is not being reflected in the prices being paid to Irish farmers. A 360kg steer is now worth at least €350 more in the UK — which was also the case when farmers protested at beef factory gates last autumn.

Cow prices at the factories remain unchanged, at a base of 330-360 cents/kg for O/P-grade, and up to 375 cents/kg, or a few cents more in some cases, for the heavy R-grade cows.

In Britain, cattle prices have firmed, with R4L-grade steers averaging equivalent to 541 cent/kg (including VAT).

Volume demand is reported as remaining subdued.

On the Continent, beef market demand is reported quiet, with Irish exporters meeting resistance to higher prices.

Demand has been shifting in favour of steak cuts and away from forequarter beef, in anticipation of the Easter holiday period.