Feeding for spring beef questionable
With beef prices at their lowest level in over a decade, it is obvious among those with cattle to finish this winter that there are more questions being raised than ever before about the economics of investing in feeding stock to slaughter next spring.
Last winter’s €3.75/kg base price was loss-making, no matter what way it is looked upon, but this will be cushioned somewhat with the €100/head Beef Exceptional Aid Measure (BEAM) payment, which will be issued at year-end.
If current prices persist at €3.45/kg into next spring, a much larger payment, in the region of €200/head will be needed to cushion severe losses.
Whether or not a second BEAM type payment will be sanctioned remains to be seen.
The accompanying table outlines the required break-even steer finish price based on current input and store prices.
Sell forward stores off grass prior to housing. Store cattle have thrived excellently on grass, and prices in the marts are still reasonably strong.
Push forward stores for an early 20-21 month finish off grass.
Farmers would be advised to weigh all forward stores at this stage.
Store over winter, and kill next summer/autumn off grass.
This is a lower-risk option and, based on Teagasc figures, requires the lowest beef price to achieve a margin.
Improving efficiency still pays.
Current beef prices make all suckler systems loss-making.
Storing cattle with a view to finishing next autumn allows the market time to correct itself.
Bull finishing is high-risk, and an agreement with processors should be made before finishing bulls.
Costs must be cut wherever possible for the foreseeable future. Implement a very basic fertiliser programme, reduce phosphorus (P) and potassium (K), continue with lime application. No investment in machinery or buildings, and keep maintenance to essentials only.
For dairy calf to beef systems, calf prices will have to fall to leave a margin. At last year’s calf prices, taking them through to finish will be loss-making in the current market. If beef prices remain low, dairy farmers must be conditioned for a difficult calf trade in 2020.
