IFA National Livestock Chairman Henry Burns has said the factories have tried to destabilise the market and frighten farmers into selling cattle at lower quoted prices. However, he added that despite the propaganda from the meat plants, cattle supplies remain very tight and some plants are having to pay a base of €4.20/kg for steers and €4.30 base for heifers to get numbers. In addition, he said these same factories were very anxious to get cattle with immediate delivery.
Henry Burns said at the moment there is a very fine line in the balance between supply and demand, and it is clear that supplies will remain tight over the coming weeks and months. He said the facts from the latest Department AIMS data for June 1st, as presented by Bord Bia, are that there are 100,000 fewer cattle in the 12 to 36 month old age bracket, compared to this time last year. This will leave finished cattle supplies tight for the rest of 2015 and into 2016.
On markets, Henry Burns said the UK remains very strong, with the latest AHDB R3 steer price for Aug 1st at £3.57/kg, which is equivalent to €5.36/kg incl vat. With the sterling exchange rate at 70p to the Euro, compared to 80p this time last year, he said this change is worth an additional 67c/kg in returns from the UK market.
Henry Burns said IFA was in contact with the NFU this week on the market situation and they report that attempts by the factories in the UK to ease back price increases over the last two weeks had not succeeded. The reality is that tight supplies is continuing to drive a very robust beef price market.