Scene set for a price battle between beef finishers and processors

Beef market report

At Skibbereen mart last Friday, three Charolais steers of 545kg, born July 2019, sold for €1,640.

Beef prices are steady at the factories for this week, as processors tighten their rein on recent price rises.

The April improvement by 20-25 cents/kg in base prices on offer for steers and heifers brought some financial relief to finishers.

But processors are always cautious at this time of the season to prevent “overheating” in the market.

The coming weeks, until beef cattle come off grass, normally squeeze intakes enough to put price pressure on processors, which will encourage finishers to hold out for price gains.

Some of that pressure was seen last week, when the intake slipped to 28,787 head.

Steers accounted for 10,916 head, there were 8,600 heifers.

There were 2,275 young bulls, and 6,107 cows, in last week’s intake.

The 2021 beef cattle supply has remained tight (heifers down 11%, steers back 5.5%), and markets are strong.

Not long ago, a weekly intake of 30,000 head would have been adequate for processors. Now, that is tight, factories can generally take up to 10% more, the result of better production of quality beef on farms and improved marketing by processors.

Early grass growth has been slow, which means that beef cattle off grass are likely to be some weeks away, a perfect market environment for a price battle between finishers and processors.

The quoted base for steers remains at 410 cents/kg in general, while up to 415 cents/kg is being paid to get sufficient stock. The going rate for last week has been maintained, but there is greater reluctance among processors this week to concede further price gains.

Heifers are on a quoted base of 415 cents/kg with up to 420 cents/kg being paid, but it is difficult to get above that. Young bulls are trading almost on par with steer prices. at 410 cents/kg for Rs this week.

The one category where price gains continue this week is cows. The best of the R-grade cows are making up to 380 cents/kg, with O-grade have improved to 355-360 cents/kg, and the better P-grade cows make 330-340 cents/kg.