AVERAGE prime cattle prices still remain less than the five-year average and indeed those of last year, but at above the 350p per deadweight kg bracket in Scotland, they are at least in front of 2014 levels and heading in the right direction.
Beef carcases hitting the desired R4L specification are selling for considerably more too, with the latest figures in Scotland showing steers at 358.4p per kg, some +1.5p up on the week, and 356.0p for heifers, up almost 0.5p on the same period.
This compares to the south of England, where the same graded cattle cashed in at 339.5p and 337.6p, respectively, for the week ending July 16. This was also up on the week, on the back of reduced supplies coming forward and increased demand from retailers with the better weather and the fall in the value of sterling against the euro.
Add that to the rise in value of young bulls to 342.5p (+2.1p) and cows at 242.4p (+3.5p) in Scotland, albeit for fewer numbers coming forward, and at long last there is slightly more confidence in the market.
It was a point highlighted by John Kyle, managing director at Caledonian Marts’ Stirling, who said that all types of cattle had increased in value.
“The waiting lists at the abattoirs appears to have disappeared, which combined with numbers not there to be killed, is helping the prime trade, and in turn is filtering through to the store trade,” he told The Scottish Farmer.
“The margins for finishers buying cattle in January and March and selling them two or three months later would have been pretty depressing, but those who bought in March/April and selling them now will be seeing a better return.
“There is definitely a bit more confidence about the trade now,” Mr Kyle added.
In contrast to most centres, Caledonian Marts is also enjoying increased cattle numbers coming forward too with Stirling able to sell the heavier types of cattle that are now being heavily penalised by abattoirs.
“We are lucky in that we get the butchers who are looking to buy the heavier weights of cattle and are also prepared to pay more for them than the slaughterhouses. Therefore we are getting slightly more cattle every week compared to this time last year,” said Mr Kyle.
Estimates suggest that just over 30,000 prime cattle were processed in the week ending July 16 – 400 head down on the week earlier, and 1100 down on two weeks previous.
With throughputs down nationwide, the GB prime steer average for the week ending mid July levelled at 332.5p per deadweight kg, (+2.7p for 0.4% more) with heifers at 334.8p (+2.3p for 3.1% fewer).
Young bulls and cull cows were also up on the week at 319.5p (+2.6p) and 215.3p (+2.2p), respectively on a GB scale, with the Scottish figures a good 20p per kg higher at 342.5p (+2.1p) and 242.5p (+3.5p).
But, while beef supplies appear somewhat scarce at present, total EU meat production is set to grow this year and next, according to the EU Commission’s latest Short Term Outlook report.
Beef production is forecast to increase another 2% this year and by a small amount in 2017. The situation at member state level is however diverse and mainly depends on the level of rebuilding of dairy herds.
The rise in production is likely to be driven by developments in EU-N13, (member states that joined in 2004, plus Croatia, which joined in 2013), on the back of higher cow and bull throughputs.
The consequences of the strong increase in the cow herd in the EU-15 is not expected to lead to significantly higher slaughterings before the end of this year.
However, some cows may be culled earlier than foreseen in certain member states because of continued low milk prices. This could well contribute to a higher beef supply in the second half of this year.
Production of sheep and goat meat is also expected to increase 2% this year and stabilise in 2017, with pig meat output expected to stabilise in 2016 overall.
The rise of poultry meat is also forecast to continue this year and next, albeit at a slower pace compared with 2015.
The report also covers arable crops and puts this year’s production at another bumper level. This is despite recent heavy rains across the main grain producing region.
With stocks increasing, prices are likely to remain low in the coming marketing year.