Base beef quotes show some signs of steadying but heifers fall 24c/kg since Brexit

The beef trade has shown some signs of steadying with most factories now operating of a base price of 380c/kg for steers and 390c/kg for heifers.

The somewhat steadier beef trade follows some uncertainty in the market since the vote of Brexit referendum became known.

Irish beef prices took a hit following the UK’s decision to leave the European Union and over the past month almost 24c/kg has been wiped off Irish R3 heifer prices.

In the second week of June, Irish R3 heifers traded at 413.8c/kg and since then quoted heifer prices have dropped to 390c/kg.

On a 280kg carcass, this is a price drop of €67/head.

However, despite the beef trade steadying over the past two weeks, procurement managers have suggested that the UK market continues to remain difficult.

One procurement manager said that the weaker Sterling is making it difficult to sell beef into the UK market as Irish and UK beef prices are almost on par.

Base beef prices:
  • Steers: 380c/kg
  • Heifers: 390c/kg
  • R grade cows: 300c/kg
  • O grade cows: 290c/kg
  • P grade cows: 280c/kg

Cow prices have also shown some signs of steadying in recent weeks, R grade cows are currently trading at 300c/kg, O grade cows are being quoted at 290c/kg and P grade lots are making 280c/kg.

Beef cattle supplies tighten

The number of cattle slaughtered in Department of Agriculture approved beef export plants has tightened in recent weeks.

According to figures from the Department’s beef kill database, the beef kill for the week ending July 17 dropped below 30,000, indicating some tightening in supply.

During the week ending July 17, just over 29,700 cattle were slaughtered in Department approved plants, which is a fall of 2.5% or 767 head compared to the week before.

The majority of this fall was due to a decline in young bull (-786 head) and cow (-267 head) throughput, while the number of aged bull and heifer slaughterings also declined by 13.6% and 1.4% respectively.

However, official figures show that the number of steers slaughtered during the week ending July 17 actually increased by 482 head or 4.5%.

Week-on-week beef kill changes:
  • Young bull: -786 head (-20%)
  • Bull: 96 head (-13.6%)
  • Steer: +482 head (+4.5%)
  • Cow: -267 head (-3.4%)
  • Heifer: -100 head (-1.4%)
  • Total: -767 head (-2.5%)

Cumulative beef kill

Looking at the cumulative beef kill for the year, an extra 24,138 cattle have been slaughtered in approved plants, bringing the total for the year to 857,887 head.

Young bulls account for the majority of this increase, with throughput numbers increasing by 30% or 28,853 head.

Official figures also show that the cumulative cow and heifer throughput has increased by 2.7% and 0.3% respectively.

However, there has been a slight fall in the cumulative steer kill, which has declined by 2%, while the aged  bull kill has dropped by 20% or 4,134 head.

Cumulative beef kill changes (2016 vs 2015)
  • Young bull: +28,852 head (+30%)
  • Bull: -4,134 head (-20%)
  • Steer: -6,183 head (-2%)
  • Cow: +4,703 head (+2.7%)
  • Heifer: +641 head (+0.3%)
  • Total: +24,138 head (+2.9%)

heifer

Main markets

Demand for beef cattle continues to out weigh the supply in Britain, according to Bord Bia, while the current spell of good weather has also helped to maintain demand levels.

In euro the British steer price made the equivalent of around €4.05/kg last week, while the latest Northern Irish R3 steer price equates to €3.92/kg.

In France, the market remains unchanged with retailers buying domestically produced beef and difficulties remain in getting imported product into the  French retail market, it shows.

Retail promotions in the main multiples continue to focus on domestically produced products such as mince and rump steaks.

However, the Italian beef market remains slow with little upturn in consumption and as a result the Italian R3 young bull price was unchanged at €3.80/kg last week.