This weeks factory quotes have seen beef prices rise again for all types of cattle, and despite weekly kills being higher than equivalent weeks of last year, processors are increasingly keen for cattle – which is clear from the prices.
Looking at how price trends have panned out over the past few weeks, the trade has somewhat echoed last year.
In both 2022 and this year (2023), price bottomed out in late October before increasing for the duration of November with increases continuing into December.
Last year ended with beef prices on the rise, and this trend continued into early February of this year before levelling-off until late May when prices began to fall again.
The graph below shows the weekly R3 grade steer prices, comparing 2021, 2022 and 2023:
While beef price bottomed out at €4.50/kg last year, this years’ price bottomed out at €4.60/kg.
Last year, Irish beef prices had fallen further behind the prime export benchmark price than this year.
According to Bord Bia, as of Saturday December 2 of this year, the prime Irish composite beef price was at €4.74/kg, a total of 10c/kg below the prime export benchmark price of €4.84/kg.
In the same week of 2022, the prime Irish composite price was at €4.72/kg, a total of 30c/kg behind the prime export benchmark price of €5.02/kg.
This would indicate that last year, there was further scope for additional price increases than this year.
Despite this, beef markets are very difficult to gauge and increases in beef demand or drops in beef supply in Ireland’s key export markets could place additional upward pressure on beef price into the first quarter of 2024 and onwards.
Teagasc’s analysis would also suggest further positivity on price.
Teagasc forecast
Teagasc’s Outlook 2024 Economic Prospects for Agriculture published last month included details on trends that can be expected next year in farm incomes, costs, and prices to farmers.
The report forecast that the price for the average R3 steer will be around €535/100kg, including VAT, next year.
That would equate to a 3% increase in the annual average finished cattle price for 2024, when compared to this year.
The report notes that Department of Agriculture, Food and the Marine (DAFM) cattle inventories show that supply of animals aged 12-24 months of age are significantly lower relative to the levels observed 12 months previously.
As a result, Teagasc is forecasting a 4% decrease in prime beef production in Ireland for 2024.
Overall EU beef production in 2024 is forecast to be approximately 1% lower in 2023. Currently, UK beef supply is expected to be unchanged next year.