Who is paying the best beef price?

This week all of the categories of cattle that were featured in individual tables are pulled together with their rank between 1 and 26, which is the total number of factories that are required to price report in Ireland. It should be noted that when a factory appears at the lower end, this may reflect the fact that a company doesn’t buy that type of stock. In these cases, we have left the fields blank.

Another general feature when looking at the buying trends of the groups it is clear that some factories are dedicated to one particular type of cattle, while others in the same group can be found towards the bottom. In ABP, for example, Rathkeale, Nenagh, Bandon and Cahir are towards the bottom for cow prices whereas Waterford is towards the top.

Similarly, Kepak’s Clonee factory has two top-positions on heifers and all types of young bull in the top five while its steer prices are all mid table or lower.

1. Foyle Donegal

Foyle was the best-performing individual factory, with four top positions and two third places in 2017. They were consistently strong across all types of cattle, with just one class, O=3= young bulls, positioned outside the top eight.

2. Kepak Clonee

Kepak’s Clonee factory also had six top three finishes, three in top place, one second and two in third place. Clonee was consistently strong in heifers, young bulls and cows, less so on steers. Overall the five Kepak factories had 13 top three positions between them in 2017 compared with 10 in 2016 among what was then four factories in the group.

3. Slaney

Although Slaney had five top three places, the same as 2016, this time it was made up of three top positions and one second and one third whereas in 2016 it was just one top spot and three second places and one third. The company performed consistently across all categories (see focus on Slaney), with just three out of the 16 types of cattle outside the top 10.

4. Kepak Clare

Kepak’s acquisition of John Kelly Meats in Co Clare had an excellent debut in the factory leagues, with five top three positions made up of one top, three seconds and one third place.

5. Dunbia

Dunbia’s Slane factory became part of the Dawn group in 2017 and was the country’s best buying cow factory, with two top places for the O=3= and P+3= category while they were the third top payer for U=3= and R=3= cows. This will be one to watch next year when it has a full year of trading as part of the Dawn group behind it.

1. Dawn

Leaving aside Dunbia who became part of the Dawn group in the latter part of 2017, the other five Dawn factories managed just one top three place between them, a second place for P+3= steers at their Ballyhaunis factory. In 2016, Dawn had three top three places.

2. ABP

Between ABP’s six factories they achieved fifteen top three positions in 2016 which has fallen to ten for 2017. This was made up of two top positions, five second places and three third places. In 2016, ABP had three top places, five second places and seven third places.

3. Jennings

Jennings was the stand out performer in 2016 with five top positions and one second place. That was a tough target to match and in 2017 there is just one top place, one second place and three third places, still commendable but down on the previous year.

Worth a mention

The Irish meat processing industry has seen further rationalisation over the past year, with Dawn and Kepak each adding a factory in the Republic of Ireland and Dawn being the main shareholder in the joint venture with Dunbia for its NI factory at Dungannon. Meanwhile, ABP has built on its acquisition of 50% of Slaney by adding 50% of Linden, Fane Valley’s beef business in NI, along with a factory in England. Of the independents that remain, two have made it on to the podium. Liffey, itself a substantial group with three Irish factories and a processing business in France, retained its two top three positions in 2017, with a second place for R=3= cows and a third place for O=3= cows. Euro Farm didn’t make the podium in 2016 but have in 2017 with two second places for O=3= cows and O=3= young bulls.

This year in factory analysis of prices paid to farmers for cattle, we are focusing on the prices paid by Slaney Foods over the three years between 2015 and 2017. In the last quarter of 2016, a deal that involved ABP acquiring the Allen family shares and assuming ownership of 50% of the business was cleared by the EU competition authorities. Slaney is now operated as a partnership between the Fane Valley Co-Op and ABP. Last year, Fane Valley decided to sell half its Northern Ireland meat business Linden Foods to ABP, with Linden operating as a joint venture in the same way as Slaney. This deal was approved by the EU competition authorities in October last year.

The Slaney deal was strongly opposed by the farm organisations and the 2017 data is the first opportunity to examine how Slaney performed in the prices paid to farmers in the first full year with ABP involvement. As the price leagues are based on average prices paid, the impact of a small number of cattle in a particular category has to be recognised and in the case of P+3= young bulls, none were reported from Slaney at all in either 2016 or 2017.

Steers

In 2015, Slaney was in third place for U=3= steers, sixth place for R=3= and P+3= and second for O=3=. In 2017, its U=3= steer price dropped two places to fifth, the O=3= dropped two places to fourth and the P+3= also dropped two places from sixth to eighth. The R=3= improved two places from sixth in 2015 to fourth in 2017.

Heifers

There was no change in ranking for U=3= heifers, with Slaney ninth place in both 2015 and 2017. On R=3= there was an improvement of four places, rising from seventh in 2015 to third in 2017 while O=3= improved by one place from second in 2015 to first in 2017. P+3= prices, however, fell by 13 places from fourth in 2015 to seventeenth in 2017.

Young bulls

Slaney were a top performer in the young bull price leagues in 2017, continuing the upward trend that began in 2016. It had previously been towards the bottom of the young bull price leagues in 2015, but in 2017 it was the top payer for R=3= and O=3= young bulls and fourth top for U=3= young bulls with no figure reported for the P+3= category.

Cows

Slaney was also a stronger buyer of cows in 2017 than it was in 2015. Numbers of cows grading U=3= are likely to be small, so wide variation year to year could be expected.

There will be a good number of continental-bred suckler cows making the R=3= category and here Slaney has shown a big jump from 20th to fifth between 2015 and 2017. The O=3= category, also a common grade for cows, also shows Slaney moving up the table from 21st place in 2015 to 12th place in 2017. P+3= cows are more likely to come from the dairy industry and in this category Slaney also performed well coming in second in the table compared with fifth in 2015.

Comment

Overall across steers and heifers, there has been minimal change in Slaney’s position in the table, with the main grades just moving a couple of places either way. There was a big movement of 13 places on P+ grading heifers but this category is likely to include a small number of cattle.

Young bulls in particular but also cow prices paid by Slaney showed an improvement when 2017 prices are compared with 2015. Two top places and a fourth on young bulls indicate Slaney is now a serious buyer in this category unlike 2015 while they have also moved up the league on prices paid for cows. Based on these figures, farmers are getting similar on steers and heifers since ABP became involved relative to other factories while Slaney’s relative position on young bulls has improved significantly. Cow prices have also improved relative to other factories in 2017.

Overall Slaney had been one of the top-performing factories in previous years and this remains the case, now across all categories.

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