Beef prices ease further as more grass cattle come on stream

Beef prices have eased further this week with most factories now operating off a base price of 380-385c/kg for steers and 390-395c/kg for heifers.

A number of procurement managers have indicated that the market for Irish beef in the UK continues to remain uncertain on the back of the UK’s decision to leave the European Union.

The Brexit result has sent shock waves through the currency markets and in particular the euro/Sterling exchange rate.

The Irish beef price has dropped considerably over the past four weeks, falling from 400-405c/kg for steers in early June.

Cattle buyers have also suggested that supplies are remaining relatively strong, as grass cattle supplies have turned a corner over the past couple of weeks.

However, despite the increase in grass cattle slaughterings over the last couple of weeks, the cull cow price has remained relatively unchanged from last week.

Farmers are currently being offered 280c/kg for P grade cows, 290c/kg for O grade cows and 320-330c/kg for R grade lots.

Beef cattle supplies

There was a slight ease in the number of cattle slaughtered in Department approved beef plants during the week ending July 10.

During the week ending July 10, the number of cattle killed at Department approved beef export plants stood at 30,504 head, down 835 head on the week previous.

The majority of this fall occurred due to a drop in young bull throughput, which declined by 16.5% or 812 head on the week before.

Steer and heifer throughput also declined by 669 head and 83 head respectively, figures from the Department show.

However, despite the fall in cattle slaughterings, aged bull and cow throughput actually increased by 55% and 6.7% respectively.

Cumulative cattle

The cumulative number of cattle slaughtered at Department of Agriculture approved beef export plants so far this year is still ahead of last year.

Figures from the Department of Agriculture show that the beef kill has been 2.9% higher this year compared to the same time last year.

The majority of the increase has been young bulls, with the kill up by 31% to the week ending July 10. Cow and heifer throughput have also increased by 2.6% and 0.4% respectively.

However despite the overall increase, the number of aged bulls and steers slaughtered have dropped on the same time last year.

Aged bull throughput has declined by 20% (4,089 head), while the steer kill is back 2.3% (6,856 head) on the same period in 2015.

Main markets

According to Bord Bia, the British beef trade has continued its upward trajectory due to demand outweighing the current supply.

It says that retail demand has improved following bursts of good weather with the demand for most beef cuts remaining relatively steady.

Although the British price is up in sterling terms, in euro the British steer price is now equivalent of €3.97/kg, while the latest Northern Irish R3 steer price equates to €3.87/kg.

Bord Bia also say that the French market remains unchanged with retailers buying domestically produced beef, but difficulties remain in getting imported beef into the retail market.

Demand remains strongest for niches such as breed specific beef such as Angus beef.

In Italy, the market remains stagnant due to reduced consumption recently. The R3 young bull price was averaging €3.80/kg while the O3 cow price was making €2.55/kg.