12 December 1997

4p rise in cattle prices provides a little cheer

By Tim Relf

FINISHED cattle markets shrugged off dismal news on the impending ban on bone-in beef, recording a small rise in prices at the start of this week.

But analysts believe Mondays 4p rise in steer values to 95p/kg is just a temporary improvement, reflecting the 12% drop in the number sold, as nervous farmers stayed away from markets.

The better-quality cattle on offer, with Christmas primestock shows under way, also helped. As auctioneer Michael Parry at Gaerwen said: "The show gave wholesalers the chance to fly the flag and show some spirit."

Demand also got a boost, because some buyers were worried about the effect of port blockades on meat availability, he suggested. "A lot can happen on speculation."

Retailers, meanwhile, talk about a "rush to buy" after last weeks government announcement of the ban on bone-in beef. Herts-based butcher Peter Harper had his busiest Saturday for six months last weekend, as customers stocked up with foreribs and oxtails.

He says the latest BSE controls, which are "disproportionate to the risk", may have had a positive effect on buying. "People are sick of the nannying attitude of the government on beef while, at the same time, they are allowed to smoke and drink themselves to death."

But many believe prices will slip back again. Richard Scott of abattoir group ADM says beef imports will worsen the traditional new year lull in cattle prices. Too many under-finished cattle are still around, as farmers cut back on feed and sell stock to beat the 30-month age limit, he adds.

Co Durham farmer David Maughan typifies the view of many. "I wont be selling any more cattle until April, but I am not looking forward to that." He is targetting the purchase price of calves, ration costs and performance levels in a fight to maintain margins.

But, according to the Meat and Livestock Commission, the beef market is set to remain under pressure, as imports and competition from other meats take their toll. Lamb, pigmeat and poultry values are down about 28%, 15% and 7% on year-earlier levels.

The calf slaughter scheme and cuts in the size of the breeding herd will, however, mean there will be 4% fewer cattle slaughterings during the first half of 1998, compared with year-earlier levels. &#42