Beef market report: Continuing strong trade may be calm before storm

The steady trade for beef has continued this week, with prices maintained at the factories — although the supply of cattle is gradually edging upwards, week by week.

The base quote for steers is unchanged, at 425 cents/kg generally.

Some sellers are successfully negotiating with the agents for up to 5 cents/kg more.

The base for heifers is holding at a premium of 10 cents/kg over steer prices, with most of the heifers changing hands at 435 cents/kg, while up to 440 cents/kg is being secured for the best lots.

It has become clear now that prices have peaked for the season.

While processors remain anxious for stock, the pressure to get extra animals appears to be easing, in line with the increase in the weekly supply.

The higher end of the price range is now only being paid by those processors still under pressure to meet the beef demand.

Most factory bosses are complaining that beef market returns do not justify current cattle prices — so these prices will be maintained only for the absolutely necessary minimum period.

Any adjustment in favour of the processors in the supply-demand balance can be expected to immediately lead to price cuts.

Nationally, the intake last week was just under 29,100 head, a slight increase from the previous week.

Finished stock are later than usual coming off grass this year, which has benefited those with animals fit to sell at the higher prices of the past six weeks.

There is a lot of concern, however, that prices being paid for forward store animals at the marts will put pressure on finishers to achieve a reasonable profit from the autumn trade — unless prices remain strong.

While supplies for the remainder of the year should be down by an average of 2,500-3,000 head per week, based on the statistics available, that would not be sufficient to bring the weekly average kill even close to the 30,000 benchmark which has a strong effect on price setting.

Cow prices have eased a shade at the top. Base quotes for O/P-grade cows are 360-375 cents/kg, with up to 390-395 cents/kg for Rs.

Some sellers are negotiating up to 5 cents/kg more.

In Britain, prices for R4L-grade steers are averaging equivalent to 512 cent/kg (including VAT).

The trade is reported to have improved on the back of tight supplies in recent weeks, and fine weather is expected to increase demand for barbecue products.

In France, there has been little change over the past week, while the beef trade in Italy is reported to be holding steady.