Tight intake of cattle sees slight increase in prices

Any movement in beef prices at factories for this week has been slightly upwards, as the intake of cattle remain tight.

There are some indications that processors are getting more anxious to acquire cattle. With the weekly throughput down more than 20% compared to the same week in 2011, it would be no surprise to hear of factory agents coming under pressure to source more cattle.

The trade appears to have edged upwards by 1-2 cent/kg, particularly at the lower end of the prices being quoted, but there is further tightening of price top-ups, with processors trying to stick to the improved quotes.

Base prices for steers are quoted at 410 to 415 cent/kg (146p-148p/lb), and in general, processors are trying to buy within that range. We have heard of up to 420 cent/kg being secured for better quality steers this week, and there is growing evidence of more steers being purchased at agreed flat prices of 410-412 cent/kg.

The price advantage for heifers over steers has increased to 15 cent/kg in general, and this pattern is consistent across the range from quoted prices to the actual purchase prices. Base prices of up to 435 cent/kg for heifers are being reported, but mainly attainable only in northern half of the country.

Intake last week was around 24,000 head, which is nearly to 5,000 head less than in the same week of 2011, continuing the consistent intake trend of several weeks.

Poor grass growth in May will slow down cattle coming off grass for another few weeks, which will test the processors’ willingness to pay more for cattle.

Having paid high prices for forward stores, farmers require an improved factory price if they are to achieve any decent return on their investment this season.

Cow prices are coming under more pressure. After a very strong season, there is some waning of interest in cows from processors this week, and the prices have eased, at the upper end of the range in particular.

Cow prices neared prime beef prices in recent weeks, but O/P grade cows are now being quoted at 350-375 cent/kg, and it is harder to get 400 cent/kg for the Rs at factories this week.

The beef trade in the UK is reportedly holding steady. Cattle prices however are reported to have eased, with R4L- grade steers averaging equivalent to 449 cent/kg (160p/lb).

On the Continent, trade across most of the key markets remains steady.


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