Higher than normal throughput continues to leave factories with the upper hand in negotiations. Steer prices have been eased back to a base of €3.85/kg in a high percentage of cases, with select deals completed at a base of €3.90/kg.

Heifers are similar, with greater availability limiting the chances of securing a higher base than €3.95/kg. Both of these prices are 30c/kg lower than the corresponding period in 2018 or the equivalent of €96 on a 320kg heifer carcase and €120 on a 350kg steer carcase.

Heifer throughput is being boosted by higher numbers finished on grass appearing.

Last week’s kill reduced by 3,041 head due to one day’s less processing. Heifer throughput only reduced by 258 head, with the lower kill stemming from 1,798 cows and 820 fewer steers. Young bulls also only reduced marginally by 158 head.

Plants active in the young bull trade are generally paying a base of €3.80/kg for bulls less than 16 months, but 5c/kg to 10c/kg lower is being paid in other plants with variable appetite for bulls.

Specifications have also tightened, with an upper weight limit of 400kg to 420kg implemented. Bulls falling outside of the desired specifications are, in cases, being penalised by non-payment of the QPS bonus, while heavier bulls face being paid at a flat price.

Bulls less than 24 months are trading from €3.75/kg to €3.85/kg for U grades, while R grades are trading from €3.65/kg to €3.70/kg. O grades range from €3.50/kg to €3.65/kg.

The spike in cow throughput has reduced average prices and opened up a wider differential between prices paid to sellers with less than a handful of cows and those handling higher numbers.

P+3 grading cows range from €2.90/kg to €3.05/kg, with O grades averaging €3.10/kg to €3.15/kg and R grades anywhere from €3.20/kg to €3.35/kg for the best-quality cows. Likewise, U grades range from €3.25/kg to €3.45/kg.

The kill is now running 43,123 above the corresponding week in 2018 and builds on significant increases in each of the last five years. The kill is running 62,748 head above the five-year average, with higher throughput underpinned by expansion in the dairy herd.

Comparative prices

The trade is in a difficult position right across the EU. The latest AHDB market report shows throughput in Britain rising by about 12% last week and adding renewed pressure.

Steer prices reduced 1.5p/kg, while heifers fell 3.5p/kg on average. R4L prices averaged £3.54/kg for last week or the equivalent of €3.99/kg at 88.8p to the euro and €4.20/kg including VAT at 5.4%.

The trade in Northern Ireland is struggling, with supply exceeding demand. Factories have reduced U-3 base quotes by 2p/kg to 4p/kg to £3.26/kg to £3.30/kg (€3.87/kg to €3.92/kg).

Along with falling quotes, finishers are facing delays in getting animals booked in for slaughter and finding it hard to negotiate prices.

An analysis of EU prices by Phelim O’Neill can be viewed at www.farmersjournal.ie. Headline figures show Irish prices comparing favourably with the EU average. French young bulls average €3.76/kg for R3 grades, with Italian prices reported at €3.53/kg, German at €3.46/kg and Dutch prices at €3.41/kg.

Spanish prices average €3.73/kg for R grading bulls, which explains their demand for live imports. Outside the EU, USA prices continue strong at the equivalent of €3.77/kg for an animal similar to our R3 steers, while Australia was returning the equivalent of €3.12/kg. Brazil, the world’s largest exporter, remains the weakest price by a distance at the equivalent of €2.17/kg.

Read more

Northern View: increased cattle supplies adds to price pressure