Hopes of pre-Christmas beef price rise fade with talk of 10c/kg cuts
With the weekly intake holding at 32,000 head, producer expectations of a pre-Christmas lift on prices has been dampened down, with some processors warning that a 10c/kg cut on the base is more likely. File photo
Beef finishers maintaining the weekly flow of cattle to the factories at 30,000–32,000 head over the recent weeks have eased the pressure on the processors to secure sufficient supply for the run into Christmas.
With the weekly intake holding at 32,000 head, producer expectations of a pre-Christmas lift on prices has been dampened down, with some processors warning that a 10c/kg cut on the base is more likely.
Cow prices remain under pressure, with some of the processors cutting a further 10–15c/kg off the prices for this week in a weekly succession of reductions for the category.
While some offers of a base at 730c/kg for steers this week is not meeting with much success for the processors, most supplies are moving on a base of 740c/kg, which is unchanged from last week.
There are fewer options for deals on flat pricing, with more insistence by the factories on grid-only terms for both steers and heifers.
Heifers are, in general, holding at last week's price on a base of 750c/kg, while trying to negotiate for a return above these bases for either steers or heifers is largely a non-runner with the factories.
Prices for R-grade cows have eased to around 680c/kg, with a general drop of 10–20c/kg across all grades of cows the order of the trade. The R-grade young bulls are making 745–755c/kg.
The positive side of the trade is the demand for all categories of stock at the factories, but it has become obvious to suppliers that a tighter control on the cost of animals is being applied across the board.
"There was a level of expectation among some finishers during the autumn that the factory demand for cattle for the Christmas market would boost the prices to a new high if the processors were forced to compete against each other," explained one source.
"The increase in weekly supply over the past month eased the pressure on the processors and then they [factories] seem to have ensured that there was no runaway on the prices and it has worked for them to hold the control," they added.
