Beef trade: High kill keeping a lid on factory prices

The recent high-kill trend has continued in Department of Agriculture beef exporting plants and this is helping to keep a cap on prices paid to farmers from the beef processors.

Looking at the latest data available, we can see that 37,700 head of cattle were slaughtered in beef plants during the week ending February 3. Even though this is a fall of 349 head on the previous week’s kill, it is still high given the time of year.

Procurement managers are still operating off a base of 375c/kg for steers and at 385c/kg for factory-fit heifers, with no reports of any higher quotes.

Bulls still remain problematic in some plants. This week, factory agents are quoting 330-340c/kg for O-grade bulls, while R-grades are moving for 360c/kg; procurement managers are quoting 370c/kg for U-grading bulls and maybe 5c/kg higher in some cases.

Most beef cattle buyers are starting negotiations with farmers at 300c/kg for R-grade cows and 280-290c/kg for O-grade types. Looking at cows falling into the P-grade category, these animals are selling at 260-270c/kg.

The beef kill

Breaking the 37,700 head of cattle that were slaughtered during the week ending February 3 into individual categories, some 6,427 young bulls were slaughtered that week – a fall of just 58 head.

In the aged bull category, a drop of 12 head was recorded with the total number coming in at 393 head. The number of bullocks sent for slaughter increased by 15 head – increasing to 11,259 head.

However, the number of cows slaughtered fell by 200 head – amounting to 7,838 head. A similar situation arose in the heifer category, with 11,674 heifers processed; this represents a fall of 157 head.

Week-on-week beef kill changes (week ending February 3):
  • Young bulls: 6,427 head (-58 head or -0.9%);
  • Bulls: 393 head (-12 head or -2.9%);
  • Steers: 11,259 head (+15 head or +0.1%);
  • Cows: 7,838 head (-200 head or -2.4%);
  • Heifers: 11,674 head (-157 head or -1.3%);
  • Total: 37,700 head (-349 head or -0.9%).

The overall kill in 2019 is running at 11,340 head higher than in the same period in 2018 – amounting to 176,037 head.

This increase in throughput has been driven by a rise in mainly cow and heifer slaughterings; supplies of these animals have increased by 3,861 head and 5,047 head respectively.

A slight rise was also witnessed in the young bull and steer category. Young bulls are up 1,676 head, while bullock slaughterings have increased by 775 head on the same period in 2018.

However, 66 fewer aged bulls have been processed when compared to the same period in 2018.

2019 kill:
  • Young bulls: 29,865 head (+1,676 head or +5.9%);
  • Bulls: 1,864 head (-66 head or -3.4%);
  • Steers: 53,466 head (+775 head or +1.47%);
  • Cows: 35,554 head (+3,861 head or +12%);
  • Heifers: 54,987 head (+5,047 head or +10%);
  • Total: 176,037 head (+11,340 head or +6.8%).