Store prices will determine beef profitability over the coming months
The price paid for store cattle this autumn will have a major impact on the profitability of beef finishing over the coming winter, and possibly beyond, according to Teagasc’s Aidan Murray.
“There was a lot of talk earlier this year about the significant numbers of extra finished cattle that could be coming on to the market in and around this time,” he said.
“To a large extent, this has not materialised. But I would be concerned that next spring will tell a different story.
“All the figures point to a large number of finished cattle coming through at that stage, which could well put significant downward pressure on farm gate prices.
“It’s still early days and a lot of suckled calves and other weanlings have to come on to the market over the coming weeks. But my instinct tells me that store prices will have to come back in order to give finishers a chance of making money next year.”
But Murray did admit that the recent devaluation of Sterling and the subsequent rise in UK beef prices could see northern buyers out in force buying store cattle in marts throughout the Republic over the coming weeks.
“This is a factor that must be taken full account of,” he added.
Murray will speak at a Teagasc meeting for beef finishers in Kilkenny next Tuesday (September 13)
“Last spring, stores bought in the previous autumn, accounted for between 60% and 70% of the price secured for finished cattle,” he added.
“This is a bit on the high side.”
Murray will outline the prospects for seven, or possibly, eight different finishing systems at the Kilkenny meeting.
“I will be discussing possible break-even price options for the range of beef finishing systems employed on Irish farms.
Murray confirmed that there will be little change regarding the input costs incurred on beef finishing units next winter.
“Home-grown cereals remain exceptionally good value,” he stressed.
“This is bad news for Irish tillage farmers. But it’s a fact of life. Most of the silage made this year did not benefit from the recent fall in fertiliser prices, from a production cost perspective. But this factor may well kick in beneficially for cattle bought to graze next year.
“There has been little or no change in bank interest rates, year-on-year.”