Beef market report: Beef processors set their sights on €4/kg or less
Quoted prices have been reduced by a further 5 cents/kg for both steers and heifers, the second consecutive week in which the return to farmers has been hit.
Processors are offering a base of 410 cents/kg for steers. Reports from around the country indicate that most of the procurement managers and factory livestock agents are under instructions not to exceed the quoted price, and it’s only in exceptional cases that farmers are securing deals at higher prices.
Heifer prices are quoted at a base of 420 cents/kg. Similar to the steers, there is strong resistance against conceding to farmer demands for more, and there is less than normal enthusiasm from processors to ‘buy forward’ at existing prices.
The improvement in the weather over the week-end, and recovery in ground conditions on farms, has eased pressure on livestock farmers to lighten stocking. But they have to balance any further weight gains by holding onto factory-ready animals against the downward price trend.
All of the vibes from the industry suggest that within a short time, farmers could be battling with the processors to maintain the steer base price above €4/kg.
February 2013 born animals are now hitting 30 months — and a penalty of 12 cents/kg for loss of the Quality Assured bonus at most of the factories (there have been some very limited exceptions where the QA was paid up to 36 months).
Last week, the intake at the factories slipped by 1,000 head, to around 29,600, which may be more attributable to the the August Bank Holiday Monday and the shorter working week than to any supply trend.
The supply this week will be a more accurate indicator of the seasonal trend in supply, which appears to be inevitably upwards in the weeks ahead.
Cow prices have eased 5c/kg at the upper end of the trade. O/P-grades are being quoted at 350-375 cents/kg in general, with a few cents more for some lots. The Rs have eased back to around 375 cents/kg.
In Britain, prices for R4L-grade steers were averaging equivalent to 538 cent/kg (including VAT), as the gap between Irish and UK prices widens again.
The trade in Britain has eased, with adequate supplies available for current demand levels. Topsides and steak cuts have performed best in recent days.
In France, the market remains under some pressure. Demand is reported to be slow, in particular for cuts such as bavettes and skirts. Promotions are centred mainly on domestically produced steak cuts.
In Italy, little change has been reported in the trade over the past week, with reduced demand continuing due to warm weather.
