Calf prices are weak and could get worse

Thursday, 1 October, 1998

By Tim Relf

CALF prices remain weak – and could fall further with the beef trade still in the doldrums and the end of the slaughter scheme looming.

“Another nail in the coffin” is how Wiltshire dairy farmer Peter Turner dubs the disappearance of the scheme on Nov 30 – following falls in milk and grain prices.

With insufficient space to rear them, all the bull calves from Mr Turners 300-head herd will continue to be sold. And even if he could keep them, hes not convinced rearing is the best option, with the finished beef market remaining depressed.

“You might come up trumps, you might not. Without a guaranteed market, you could be wasting your time,” he says.

Northampton auctioneer Keith Rose advises farmers to make more use of beef bulls in view of the disappearance of the £70 base price provided by the scheme.

		“If Friesians drop, say, £50 in value, Continentals could fall by a similar amount. The top end, now at £150 to £180, could fall to between £100 and £120. I dont think well see the £200 calf for a while,” says Mr Rose. Although prices have weakened, particularly for heifers, demand still exists, so now is a good time to buy, says John Waine of Mid West Calves. “Its the right weather and the calves are just the right age at turnout.”
Buyers are bidding cautiously for calves at auction marts

For some people, its a case of “what else is there to do”, he says. “If you dont have sheep, cow or milk quota – and are not eligible for area aid – youre not exactly spoilt for choice.”

Rearing beef is probably as good as anything at the moment, with cheap grain and subsidies, says Mr Waine. “Friesians could be a good bet. Aim to keep them in the 0 grade, though, rather than P. Admittedly, thats easier said than done.”

The German elections, meanwhile, could speed progress to a lifting of the British beef export ban – hopefully by the end of the year, says Mr Waine.

Anyone waiting until after 1 December to buy calves in the hope of rock bottom prices may be disappointed. A lot fewer will then be on offer – and the later start the animals will have had may mean progress to finish is slowed, says Mr Waine.

Peter Hambleton, of Warwickshire Quality Calves, says while there is a “negative mood”, prices may not fall as much as some people are predicting after the scheme disappears. With farmers selling as many as possible before then, and buyers holding off, the fall may be mitigated.

The sums look good for rearing decent Friesian bulls, he says, suggesting prices for the top end could be £30-£50 after the scheme disappears. Mediocre ones could change hands for between £20 and £40.

Continental calf values, meanwhile, are likely to follow black-and-whites downward, he says.