Beef Markets: No indication of post-Christmas overhang as prices start to tighten

January is normally a quiet month for consumer demand for beef in the aftermath of the festive celebrations.

As the beef factories resumed operations this week, following the festive season break, there was little for the livestock suppliers to cheer about.

On the face of it, the official quotes being given to farmers this week are unchanged from the pre-Christmas trade, but the bottom line is that the returns will be down on the December sales.

There has been a firm tightening in the prices being paid with the 'top-up' on the quoted prices, worth around 5 cents/kg before Christmas, no longer available.

The base for steers is being quoted at 425 cents/kg on a 'take it or leave it' policy by the factory agents, who appear not to be over-concerned at not getting the stock, if they have to cost more.

It is a similar policy for heifers on a base of 430 cents/kg for this week's purchases.

There are some supplies going through the plants this week at higher prices, having been advanced purchased by the factories, but the overall indication is for tighter prices, at least in the short term.

January is normally a quiet month for consumer demand for beef in the aftermath of the festive celebrations and there is not the same pressure on the processors to get large supplies to fill the orders on their books.

The young bull prices have eased by around 5 cents/kg and are now trailing the similar grade steer price by 5 cents/kg, a reversal of the parity of the steer and young bull price pre Christmas.

The R grade young bulls are being quoted at 420 cents/kg this week and O grade at 410 cents/kg.

While any tightening in the price will not be welcome news to finishers, the positive side is that there is reasonable optimism for the trade forward.

There is no indication of any overhang of beef in the factory stores, which is a positive, and as the consumer demand picks up through this month, the factories will require good numbers of prime cattle in particular.

All the focus over the coming weeks will shift to the potential for the spring prices. 

Store cattle purchases over the past three months have been costly and finishers have had to meet higher feed costs.

The cow prices continue to return up to 390 cents/kg for R grade with the prices ranging from 380 cents/kg.