Supply/demand balance shifting back in the factories favour

The supply and demand balance appears to be shifting back in the factories favour as cattle numbers are expected to increase this week.

Procurement managers are clear in the assessment of the market with many indicating that lairage yards are either full for the week or are filling up fast.

And given the anticipated increase in supplies, some of the ‘sweeteners’ that were available on the market last week may be harder sought this week.

Last week, farmers could expect offers of 375-380c/kg for steers and 385-390c/kg for heifers, but many buyers are only willing to offer a base of 370-375c/kg for steers and 380-385c/kg for heifers this week.

Cow prices remain at a similar level to last week, with most buyers offering 330c/kg for R grade cows, 310-315c/kg for O grade lots and 290-300c/kg for the plainer P grade cows.

Cattle supplies growing slowly

Cattle numbers appear to be growing slowly with supplies up by 3% or 959 head during the week ending January 29 on the week before.

During the fourth week of the year, some 33,158 head of cattle were slaughtered in Department of Agriculture approved beef export plants – the majority of which were steers (10,869 head) and heifers (9,645 head).

Both of these catagories showed an increase when compared to the week before, with steer throughput up by 5.5% (+563 head) and heifer numbers up by 0.8% (+72 head).

The weekly cow kill also increased by 386 head (+5.9%) on the week before, while young bull and aged bull throughput fell by 0.9% and 7.3% respectively.

Week-on-week cattle supplies:

Young bull: -48 head or -0.9%
Bull: -28 head or -7.3%
Steer: +563 head or +5.5%
Cow: +386 head or +5.9%
Heifer: +72 head or +0.8%
Total: +959 head or +3%

Cumulative beef kill

In addition, figures from the Department of Agriculture also show that just over 125,000 cattle were slaughtered in Irish plants so far this year.

However, this is a 4,722 head (3.6%) fall when compared to the corresponding period in 2016, which is mainly due to a drop in young bull (-3,287 head) and steer (-2,353 head) disposals.

Official figures also show that the cumulative heifer and aged bull kills are back by 2.1% and 14% respectively, but cow throughput has actually increased by 2,006 head or 8.8%.

Year-on-year beef kill changes:

Young bull: -3,287 head or -13.7%
Bull: -219 head or -14%
Steer: -2,353 head or -5.1%
Cow: +2,006 or +8.8%
Heifer: -806 head or -2.1%
Total: -4,722 head or -3.6%

Main markets for Irish beef

According to Bord Bia, the UK beef trade remains unchanged with ongoing strong supplies sufficient to meet current demand levels.

Cattle prices from the AHDB show that British R4L steers decreased again in Sterling terms and averaged 362.6p/kg (424.27c/kg) during the week ending January 28.

R3 heifers made the equivalent of 420c/kg in Britain and 409c/kg in Northern Ireland.

Bord Bia also reports that the French market continues to be dominated by domestically produced beef while demand for cuts such as entrecotes and steaks remains poor.

Trade was best for offal products while promotions were limited focusing on domestically produced ribs.

The latest R3 young bull price was averaging at 372c/kg while the O3 cow price was making on average 303c/kg.