More stable market predicted, but no short-term lift in beef prices

By Jeremy Hunt

It has been a tricky time for beef finishers as prices have fallen by at least 30p/kg, but while there are deepening concerns over the impact on the ever diminishing number of suckler cows, demand for store cattle continues to be strong.

While auctioneers aren’t expecting any lift in prime cattle prices in the short term, signs of a more stable market at current levels or slightly higher are predicted.

And that is certainly being borne out of the demand for store cattle and stirks, with buyers making the most of this season’s abundant grazing. Nine-month-old stirks are making up to £900 in some markets, which matches last June’s trade.

This week at Penrith Auction Mart in Cumbria, prime bulls averaged 172p/kg and clean cattle 189p/kg – both prices are on a par with two weeks ago, but are down 20p/kg and 30p/kg, respectively compared with two months ago.

In the South West it’s a different story, with a shortage of finished cattle currently bolstering demand.

“It’s not all gloom and doom. We were very, very short of cattle this week and it pushed heifers up 10p/kg and steers 5p/kg with the best prime cattle making just over 200p/kg,” reported Greenslade Taylor Hunt auctioneer Rob Venner, based at Sedgemoor, Somerset.

While this year’s lower prices are putting intense pressure on finishers’ margins, buyers looking to kill cattle in 12 months’ time are holding their nerve and paying up for stores on a very firm trade.

Sheep

In total contrast, the prime sheep sector is seeing big increases in numbers being readily mopped up by buyers supplying a bustling export market and a healthy demand at home.

A year ago new season lamb was averaging about 230p/kg, but this week – despite higher throughputs at most centres – prices have lifted by up to 15p/kg.

And it’s the marketing strategy of many producers who are selling lambs earlier and at lighter weights than they would normally do, that looks like benefiting prices even further in the coming summer months.

North Yorkshire auctioneer Ted Ogden of Skipton Auction Mart had 1,000 more lambs to sell this week compared with last year and yet prices were up 10-15p/kg to average 242.5p/kg.

“Hoggets were cleared earlier this spring and even though new season lamb numbers are well up, the demand is there. Producers are keen to cash lambs at these prices even though they are selling earlier and at lighter weights.

“It’s taking lambs off the market sooner and that’s bound be better for the trade during the midsummer flush,” says Mr Ogden.

Auctioneers remain confident that prime lamb prices will remain firm for the rest of the year providing exchange rates are in favour of exports – but producers need to be aware of quality.

Selling at lighter weights must not mean marketing lambs that are underfleshed and lacking finish, advise auctioneers.