Older beef might worsen low price carry-over in ’06

Beef producers will certainly not be sad to see the back of 2005, a year when disappointing prices shaved a big slice off margins.

But, as the first prime cattle of the New Year go under the hammer, there is trepidation among finishers that the carry-over of lower prices will be exacerbated by the older beef now coming on to the market.

Andrew Quick, who farms in the family partnership at Crediton, Devon, sells prime cattle deadweight through St Merryn Meats, but says the 187p/kg base price being quoted before Christmas was “very disheartening”.

“We need 200p/kg to give us some margin and, really, at least 220p/kg to make the beef job pay as it should,” says Andrew, who sells Limousin- and Blonde-sired suckler beef in mainly E and U grades.

About 100 to 150 prime cattle are sold each week at Longtown auction mart in Cumbria under auctioneer Michael Hall’s gavel.

He is cautious about the impact of cow beef on the market in the New Year, but says the trade sold a lot of beef in the weeks before Christmas.

“Right up to the holiday, buyers were looking for cattle, so we should still see the 110p/kg for bullocks maintained early in the New Year,” said Mr Hall.

Some finishers have been coping with hefty shortfalls compared with returns from prime cattle sold in 2004.

One Cumbria producer said his 600kg suckler-bred steers were netting up to 1100 a head in 2004 – including two beef special premium claims and the slaughter premium.

His 2005 total was about 730 a head even though the market price of about 123p/kg was unchanged.

Auctioneer Bruce Daniel of Leek auction mart said the 110-113p/kg prices recorded in his ring from January to March 2005 took a dive to below 100p/kg by June.

“There is a hint of a better trade in the New Year on the back of better prices in December.

Let’s hope it materialises,” said Mr Daniel.