Beef prices: beef kill and beef price stagnant

This week’s bank holiday has brought unwanted downtime in processing, with pressure remaining on producers to move stock.

There is extra capacity in most plants to increase the kill and compensate somewhat for a day’s less processing, but reports suggest daily activity will be largely unchanged in many factories.

This ties in with the trend of static throughput in recent weeks. Last week’s kill was recorded at 37,893 head and is on par with the average kill of 37,858 head recorded over the last four-week period.

It is marginally behind the corresponding week’s kill in 2018 of 38,452 head. The standout difference, however, is that factories had a much greater appetite for stock in 2018, with the kill for the comparable next five-week period recorded at 40,113 head.

Prices remain unchanged. Most steers and heifers are trading on a base of €3.45/kg and €3.50/kg, respectively. There are small deviations from this price, with some plants offering a lower base of €3.45/kg for heifers while Liffey Meats’ price agreement of a base of €3.50/kg for steers and €3.60/kg for heifers is reported as remaining in place until 01 November.

The focus in most plants remains on stock factories desire most – steers and heifers less than 30 months of age. This is likely to remain the case in the coming weeks as factories start to fill orders for the Christmas trade and also look to capitalise on more plants being approved to supply beef to China.

There is no change to cow or young bull prices. P+3 grading cows range from €2.60/kg to €2.70/kg, while average returns for O grading cows range from €2.80/kg to €2.90/kg. R grading cows average around the €3.00/kg to €3.05/kg mark in most plants, with U grades 10c/kg to 15c/kg higher. Plants most active in the trade are in cases paying higher for young and heavy carcase cows. The mart trade also remains a good outlet for these young and better-quality cows.

Bulls less than 24 months old and trading off the grid are averaging €3.40/kg to €3.45/kg for R grades and €3.50/kg to €3.55/kg for U grades. With an increasing focus on carcase weight, it is advisable to check at what point deductions come into play before moving stock. The same can be said of poor-quality under-fleshed and light-carcase cows. Bulls less than 16 months old and trading on the grid are moving on a base price of €3.40/kg to €3.45/kg.

Northern trade

While throughput remains above normal in northern plants, there are signs of numbers starting to tighten.

The general U-3 steer and heifer base quote is unchanged, ranging from £3.12/kg to £3.20/kg.

Sterling maintains its stronger position of 86.2p to the euro, putting the equivalent price at €3.62/kg to €3.71/kg and €3.82/kg to €3.91/kg VAT inclusive at 5.4%.

Continental heifers in particular are tighter, with sellers having more success in negotiating 2p/kg to 4p/kg higher and pushing price above £3.20/kg.

A number of continental European markets continue to record a recovery in price. However, the British trade remains under pressure.

The latest AHDB price report shows prices for steers, heifers and young bulls steadying. This leaves R4L steers trading at £3.35/kg (€3.87/kg or €4.08/kg VAT inclusive), with heifers 2p/kg lower.

It is unlikely that the decision by the EU to grant the UK a Brexit extension until 31 January 2020 will significantly lift stagnant consumption and deliver a well-needed boost to beef market performance.