The Chairperson of ICMSA Livestock Committee, Michael O’Connell, has said that the recent positivity around prices in the beef trade is being undermined by the ‘mixed messaging’ coming from meat processors over the past few weeks.
Mr O’Connell said that the beef processors were going to have to ‘make up their minds’ on what it was they wanted as farmers were not ‘mind-readers’ and could not afford to be producing animals that factories deemed too heavy or too light according to the factories’ whim.
“We recently had a factory representative telling us that Ireland’s supermarkets don’t want striploin steaks from an animal weighing 420kg carcass weight because the consumer won’t pay for them. Almost simultaneously, we had another factory representative noting his concern around dwindling carcass weights of cattle over the last number of years.
“So, where is the sweet spot here? Can the meat processors make their mind up? It is time for meat processors to come out with a roadmap that sets out where they see the markets for these cattle – whether they be heavy or light – and what they are looking for from producers of prime cattle. We can’t have this mixed-messaging and farmers not knowing from week-to-week,” said Mr O’Connell.
The ICMSA Livestock Chairperson said that it was likely that the ‘big players’ will return to the marts in the next few weeks to fill there feedlots for the run up to Christmas trade. He asked why it was so difficult to show a bit of commitment to finishers and give them a basic roadmap on where trade and markets are going to be for the next few months.
“Farmers drive the beef industry in Ireland and such a roadmap is the minimum required so that they (farmers) can plan accordingly for the immediate months ahead. The investments made here are just too big and costly to risk failure or lack of return on investment. The organic meat processors come out with a pricing model for six months at a time where they allow its suppliers to make decisions that best suit their farms. Why can’t conventional processors follow suit?” asked Mr O’Connell.
Turning to the general picture for the beef trade, Mr O’Connell said that the week ending 10 August 2024 has seen factory throughput at 30,699 versus 33,329 in the corresponding period last year. This is a massive swing in throughput with steers accounting for just under 2100 of this number.
He said that the later spring and poor grass growth this year will have had a knock- on effect on this number but it should also be noted that the record export figures in 2022 of calves and weanlings is feeding into this period of low availability of finished cattle.
“It is clear to be seen that factories are concerned with a rise in quote prices across the country this week with steers trading at €5.05c/kg base price with up to €5.15c/kg been reported to have been paid. We have heifers trading at €5.10c/kg base price with up to €5.20c/kg been reported as being paid.
“Cow trade has remained very positive despite a 10% increase in throughput year to date with P and O cows trading at up to €4.50c/kg flat for a mix of P and O cows that are over 270kg deadweight and a 2+ or better in fat score. Trade has heated up of late with factory agents actively looking for beef cattle with the instructions ‘not to leave the yard without them’.
“There has been notable increase in the number of finished and forward cattle in marts with heavy continental bullocks in the 700 to 800kg weight bracket making in excess of €3/kg liveweight. Going back to my earlier point, I don’t believe factories don’t want heavy cattle as when those continental bullocks are fit for slaughter or potentially slaughtered straight out of marts, they most definitely will be north of 420kg carcass weight,” said the ICMSA Committee Chairperson.
Mr O’Connell said that beef producers have had a tough year between grass growth and fluctuating prices, and he encouraged farmers with slaughter-fit cattle to explore their options before selling. He said that the mart is a strong marketplace at present with factory agents extremely anxious to fill out booking sheets with some buyers seeking finished cattle for export as well as massive demand from Northern customers.
“Do not be rushed into selling your cattle. Take your time, explore your options, it is a sellers’ market at present,” he concluded.
