The Irish Creamery Milk Suppliers’ Association (ICMSA) has slammed what it has described as “scaremongering rubbish” warnings from beef processors over post-Christmas beef prices.
Michael O’Connell, chair of the ICMSA’s livestock committee, said that some processors have suggested that beef prices “will be dropped immediately after the Christmas kill” and that there will be a “price correction”.
“This is the usual attempt at manipulation and farmers just have to call their bluff and look through the scaremongering to the figures,” O’Connell said.
According to the chair of the ICMSA’s livestock committee currently prices are sitting “between 50c and 60c/kg ahead” of where they were this time last year and he believes “all indications point towards less factory-fit cattle in the short-term”.
O’Connell added: “The factories are looking at that situation and trying to work out how they can get away with controlling the price.
“Hence these silly and transparent warnings designed to prepare farmers for an attempt by the processors to drop price post-Christmas trade and into the New Year.”
He has also highlighted that the increase in factory price has seen “a simultaneous price rise in both forward store and finished cattle at mart level”.
O’Connell also stated that the return for these cattle seems “typically higher in the mart than the factory”.
Beef prices
“Your typical R grade steer, 700kg with a kill out of 55% equating to a carcass weight of 385kg commanding a base price of €5.25c/kg while ticking all the boxes to get its Quality Assured Bonus by being u30 months, Quality Assured, 70+ days in the herd, less than 4 movements, is making a grand total of €2098.
“But the simple reality is that equivalent cattle are making €3.10/3.15c/kg liveweight in the mart. To put it quite simply, that’s €72 to €107 per head more in the mart.
“This shows the level of discontent and irritation felt by the processors: they are willing to give more than factory value in the mart to secure slaughter-fit cattle,” he added.
O’Connell has urged farmers to “sell hard and don’t take the first price offered”.
Marts
He said currently the mart “is a hugely promising option” because processors are battling at ringside amongst each other, as well as feedlot buyers and Northern customers.
“We have seen 5c to 10c rises in cattle in the last fortnight and ICMSA thinks that it’s not finished.
“Factory procurement staff have admitted to operating day-to-day and notably falling short of the daily kill plan requirement.
“Base prices of €5.25/5.30c/kg for steers and €5.30/5.35 for heifers have been paid this week while flat price deals of up to €5.25c/kg for Friesian steers, €5.70c/kg for a mix of Hereford and angus steers and heifers are being reported,” O’Connell pointed out.
However he also acknowledged that Irish beef prices have still “a way to go” before they catch up with its “UK counterparts”.
“The demand for Irish cattle throughout Europe and other parts of the world is so strong that we have seen Irish cattle exports surpass 330,000 head year to date with a further 6 or 7 weeks left before year-end,” O’Connell added.