Steer prices may well start to strengthen again, once the current flush of beef cattle has passed through the system, according to ICSA general secretary Eddie Punch.
“€4/kg, and possibly, above this is a definite probability,” he said.
The beef price has tumbled back from highs of €4.25 in early August on the back of stronger than expected supplies and weak demand in some of our key markets, particularly in France.
However, according to Punch the reality is that beef cattle numbers will start to fall off once this year’s main throughput of finished animals has been slaughtered and processed.
“Supply and demand should then kick in to strengthen prices.”
But Punch could not predict exactly when beef markets will start to strengthen.
“The last two weeks of excellent weather has served to improve ground conditions country-wide,” he said.
“So farmers should not be under any pressure to push cattle in the direction of the plants, despite the changeable weather that has been forecast for the rest of this week.
“The advance of this year’s Basic Payment will be arriving in farmers’ bank accounts over the next fortnight. This will act to improve cash flows on all livestock businesses. And this, again, will take the pressure off finishers to get rid of cattle in a hurry.”
Given all of these factors Punch is predicting a steady, but controlled, flow of cattle in the direction of the meat plants over the coming weeks.
“The 30-month issue will kick in as a factor in determining the numbers of cattle submitted for slaughter over the coming weeks,” he said.
“The plants still seem committed to using this criterion as a way of putting pressure on farmers. It is a measure which ICSA feels is totally unnecessary.”
Punch said that as, a bottom line, farms must sell cattle when they are ready.
“There is no point throwing stock at the factories, simply for the sake of it. The good news is that farmers should be in a position to push for the best possible price that is available for their stock at the present time.”