By FW staff
ENTHUSIASTIC bidding at stores sales has given rearers a good return, and as a result finishing margins will be tight, warn auctioneers.
According to Mark Gardiner of Bagshaws, the flush of spring grass has yet again helped carry trade forward. “Its been a grassy time and that always pushes on demand,” he says.
With good entries of over 500 stores at the Saturday sale at Uttoxeter, prices have been buoyant and probably as strong as they have been seen for a year or so, he adds.
Top price at last weekends sale was £655 for a Limousin cow with a bull calf at foot.
Other sorts were selling for around £550 for two-year-old Simmental steers on Red CIDs and £530 on Green CIDs. Charolais prices were just behind.
But bidders eagerness may have been prompted by prospects of a shortfall in finished stock later this year levering up prices.
That may be premature, suggests Mr Gardiner, as theres nothing to suggest theyll be any different to last year when they climbed slowly from 80p/kg to 95p/kg liveweight. “I wonder if some will actually pay,” he adds.
Pressure on prices could be increased later in the year unless the suspension of beef exports from Northern Ireland – caused by faults in the cattle tracing system – is resolved.
More beef sold on the domestic market will pull down prices, suggests the trade.
For some buyers, margins simply wont stack up, says Ross-on-Wye auctioneer Stephen Watkin. “Recent trade has slipped, but prices are too keen to be guaranteed a return.”
With his own land to be grazed as well, Mr Watkin has held from buying stores as prices have soared giving an indication that he thinks the market has gone too far.
“I have to say Im a bit doubtful if stores at their present value will pay. Those whove bought dear wont make a bean out of finishing some of them,” he suggests.
Mr Gardiner agrees, adding: “But its the finisher who needs to make the money.”
Its not just finishers buying now that may be affected, he continues. “Those buy in the back-end to over-winter between October to April definitely need to buy right.
“Anyone who had the nerve to do it last year will have made a profit – but Ill qualify that by saying they needed it.”