Market demand for beef has strengthened prices at factories this week for the strong intake of cattle.
Processors have been taking in over 37,000 head per week, more akin to an autumn supply than that of mid-July.
At that level of intake, downward pressure on prices is usually the outcome. Instead, factory agents are being put under pressure to maintain the strong supply of cattle, and their bosses are paying up to ensure they get sufficient stock ,which adds up to very strange times in the beef market, at this normally low point of the year for intake requirements.
Forecasting the trade has always been hazardous, but who’d have thought that in mid-July the cattle supply would be so high, with the price still going in the right direction for finishers?
The first decline in weeks of intakes at factories was seen last week, falling back to 35,758 head, but that still beats the same week last year by 1,000 head.
The steer supply remained strong at 13,546 head, almost 2,000 ahead of 2019, heifers at 9,437 were slightly lower than 2019. Cows continued strong at 9,524, but young bulls are well behind last year, at 2,326.
The quoted base for steers is generally 365c/kg this week, but an increasing percentage are making up to 370c, which has become the new cut-off point on price.
The trading pattern is similar for heifers, being quoted for at a base of 370c, but with a good measure of 375c being paid.
There are reports of some processors trying to get both steers and heifers for less than these base prices, but without much success, as few farmers are willing to part with stock cheaply, while the grass is growing well on their farms.
Most of the young bulls are making 360c for R-grade. Some processors quote back at 355c; in general, interest from the factories for young bulls is not exciting, with the intake well down on 2019.
The cow trade has steadied. In general, the top price for the better quality R-grade cow is between 315 and 320 cents/kg this week. At the other end, P-grade cows are making 280c-290c/kg, and Os are at 29c0-300c.