Beef market report: Beef heifer price premium comes under pressure

While the steer prices at the factories are holding steady, heifer prices are coming under pressure this week.

The general run of quoted base prices for steers remained at 395 cents/kg.

Some farmers are negotiating a base of 400 cents/kg, but the success rate is low, with processors playing hard ball to get the stock at the base price.

The steer supply is strong, accounting for close to 50% of the total intake, and is likely to remain strong through the remainder of September and October, as more animals come up to 30 months.

The price premium for heifers over the steer price has been reduced by 5 cents/kg with a base of 400 cents/kg being offered at most of the plants.

While it appears to be a shade easier to get up to 5 cents/kg over the base price for heifers, compared to the steer market, the higher heifer price is not generally available.

Cow prices range from 340-355 cents/kg for O/P-grade cows, up to 370 cents/kg offered for Rs this week.

Intake at the factories for last week was stable, at around 31,200 head.

This was 2,700 less than the corresponding week last year, and is in line with the expectation that the weekly kill will average about be around 2,500 les this autumn, compared to 2014.

The September-October weekly intake last year ranged from 34,000 to 36,000 head, with the supply peaking at 37,500 head in early November.

If the intake averages 32,000-32,500 per week over the coming months, there won’t be much pressure on processors to pay extra to secure additional beef cattle, unless there is an unexpected upturn in market demand.

Nevertheless, this level of weekly beef cattle supply should leave beef farmers with hopes of prices holding near their present level, and improving if there is some tightening in supplies leading up to the busy Christmas trade.

In the beef trade in Britain, prices for R4L-grade steers have been holding relatively steady, equivalent to 513 cent/kg (including VAT).

Some uplift in demand has been reported, attributed to people returning to work after the holiday season. Demand is reported as best for diced beef.

In France, there has been little change in the beef trade, with retailers more reluctant to stock imported product.


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