Beef prices fall by up to 20c/kg in first major downturn in nine months
Quoted prices are being cut by between 15c/kg and 20c/kg across the main categories as steer, heifer and young bull prices are hit by disappointing cuts at a critical time of the year for finishers.
Beef processors are exerting downward pressure on the prices this week in the first serious downturn to the trade in nearly nine months.
The quoted prices are being cut by between 15c/kg and 20c/kg across the main categories as steer, heifer and young bull prices are hit by disappointing cuts at a critical time of the year for finishers.
Steers are being quoted on a base of 740-750c/kg, with a little more being paid for some lots, but an overall tighter squeeze by the factories on paying extra.
Heifers are generally at a base of 750-760c/kg. Those getting 770c/kg this week are fewer, while the R-grade young bulls are working off 740c/kg and up to 750c/kg, towards getting all the intake back on the grid.
Cow prices have taken an even heavier tumble than the prime beef, with quotes down by 40-45c/kg.
Suppliers are reporting there is still a small bit of 'flat' pricing, but it is harder to get. Processors are blaming a weakening in the market returns for the downturn, which has dampened the optimism of the finishers.
"It's one thing to stabilise the upward movement of the prices, but cutting price for the prime beef at this time of the year is almost unheard of and despite what the factories say about 'market adjustment' being justified, it is going to shake confidence in the trade," was the view of one analyst this week.
He reiterated it was usual for beef price to reach a seasonal peak between mid-April and early June because supplies were usually scarce, putting processors under more pressure to secure sufficient to meet their market orders needs.
"Supplies to the factories year to date are up and all of the stats are showing that finished animals are getting scarce on farms, so is the pulling of the prices a factory tactic to pull out more cattle by driving fear into finishers of more cuts?" he said.
Suppliers are reporting a lot of mixed and confusing views coming from the factory representatives this week. While some are showing to be anxious to get cattle, others are pushing back the intake of stock for up to a week.
