Beef price pressure intensifies, as supplies approach the one million head mark

Beef cattle prices are coming under increased pressure this week, as factory agents continue to tighten their grip on the market.

Most buyers are now offering 395c/kg for steers and 405c/kg for heifers. Last week, 400c/kg was widely available for steers; but the number of processors willing to pay such a price has reduced dramatically this week.

This week’s price cut of 5c/kg means that steer and heifer quotes have eased by almost 15c/kg in just eight days – and buyers are confident that it won’t have a negative impact on throughputs.

Factory agents are fully convinced that supplies will remain strong this week, despite the 5c/kg cut, and many are expecting the daily kill to sit around the 6,500 head mark.

Despite the downward pressure on steer and heifer quotes, cow prices remain largely unchanged from last week.

Most beef cattle buyers are offering 350c/kg for R-grade cows and 330-340c/kg for O-grade animals. However, with prime cattle prices inclined to narrow further in recent weeks, cow prices are also likely to come under increased price pressure. Click here for an in-depth breakdown of prices

Supplies approaching the one million mark

The number of cattle slaughtered in Ireland this year is approaching the one million head mark, official figures show.

Figures from the Department of Agriculture’s beef kill database show that some 963,868 cattle have been slaughtered in Ireland this year – an increase of 45,551 head or 4.96% on 2016 levels.

And, with weekly supplies sitting at 31,000-32,000/week, the one million head mark is expected to passed by the midpoint of next week.

During the week ending July 30, some 31,756 cattle were slaughtered in approved beef export plants. This is a decrease of 0.4% or 135 head on the previous week.

Decreases were witnessed in the number of young bulls, cows and heifers slaughtered during the final week of July. Young bull throughput declined by 8.4%, 1,100 fewer cows were slaughtered and heifer throughput declined by 3% or 234 head.

Despite this, there was actually an increase in the number of aged bulls and steers slaughtered in approved beef export plants during the week ending July 23.

Week-on-week beef kill changes (week ending July 30):
  • Young bulls: 2,396 head (-220 head or -8.4%);
  • Bulls: 614 head (+15 head or +2.5%);
  • Steers: 14,497 head (+1,436 head or +11%);
  • Cows: 6,611 head (-1,100 head or -14.3%);
  • Heifers: 7,620 head (-234 head or -3%);
  • Total: 31,756 head (-135 head or -0.4%).

Main markets

According to Bord Bia, the British beef trade showed little change last week. This came as demand remained steady and a small rise in supplies was observed.

Prices from the AHDB show the British R4L steers made the equivalent of 428.46c/kg during the week ending July 29. In addition, Northern Irish and British R3 heifer prices made the equivalent of 413c/kg and 423c/kg respectively.

Moving to France, Bord Bia says, the market remained slow last week on the back of the holiday season. This resulted in a number of restaurants and butcher shops closed their doors.

In addition, trade was sluggish for offal products and demand was best for bavettes and ribs of beef. However, Angus beef was still performing well; but increased domestic supplies were offsetting imported product on the market.