The pressure on beef prices at the factories has continued to erode returns for farmers this week, with the intake at remaining very strong, setting a new February record.
Processors easing back the quoted prices for both steers and heifers as much as 5 cents/kg is mounting pressure on beef farm profitability, approaching the normal peak of spring finishing, with returns being undermined by the very strong year-to-date supply.
Base prices offered for steers slipped to 370 cents/kg at a number of plants this week, while a base of 375 cents/kg was still available at others for the opening days of trading this week, at least.
There were some reports of up to 380 cents/kg being paid, but it is much more of a struggle this week.
Heifer prices are following the same trend, with a base of 380 cents/kg at the bottom of the trade.
However, it does appear to be a little easier to get something extra, 385 cents/kg, or in some cases up to 390 cents/kg, for heifers than for steers.
There is no change in cow prices.
Prices for O/P-grade cows range from 290 to 315 cents/kg, with the quality R-grade cows making up to 340 cents/kg, as the gao between cow prices and prime steer beef prices continues to narrow.
The intake at the factories last week was more like a peak autumn supply in a strong year than that of mid-February.
It topped 35,250 head, which is more than enough to leave the processors in a very strong position to dictate the trading terms.
At that level of supply, there is very little bargaining strength left for farmers to negotiate on price, if they want to clear their sheds.
Heading for 36,000 head, the weekly intake has set a new record for February, and we could be on course for a new record for the overall spring kill.
The last time the weekly spring intake reached these levels was in April, 2006.
In the UK, the beef trade continued steady over the past week, with strong supply being offset by good demand, particularly at retail level.
Prices for R4L-grade steers averaged 362.8 pence/kg, which was equivalent to 447 cent/kg (at €1 to 85p sterling, and with VAT included).
On the continent, the beef market in France remained unchanged from previous weeks and continued to be dominated by domestic product, with the trading strongest for offal products.
In Italy, the market has remained stagnant, with little change in prices or demand.
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