September 21, 2011

 

Ireland's cattle prices set to increase next year

 

 

With the shortage of prime cattle for slaughter in Ireland, strong cattle prices are set to continue until next year.

 

Bord Bia's analysis of cattle supplies shows that the availability of prime cattle for the rest of this year and into 2012 looks set to be considerably tighter than last year.

 

So far this year, prices paid by Irish beef plants have been more than 16% higher than the same period last year, and Irish average cattle prices exceeded the EU average for the first time since mid-2008.

 

As revealed by the Department of Agriculture's AIM figures, the biggest decline is in the numbers of young male cattle.

 

Male animals aged 12-30 months are 165,000 head lower than the same time last year. This is largely the result of strong live exports of male calves and weanlings in recent years, along with the increase in young bull production.

 

Bord Bia's figures indicate that finished cattle supplies at Irish export meat plants so far this year are running 55,000 head, 5%, lower than 12 months ago.

 

Within this, there is a clear switch away from steer beef to bull beef, with a 14% fall in steer numbers slaughtered and a 20% increase in young bulls slaughtered.

 

The number of heifers slaughtered is down 8%, while cow slaughtering is on par with last year. However, an increase in cow numbers is expected as culling is ramped up on account of the tight dairy quota situation and ample stocks of replacements.

 

Bord Bia's beef market expert Joe Burke said that taking the AIM figures into account, cattle supplies at export plants are this year expected to fall by 100,000 head to 1.54 million head.

 

Irish price prospects will also be boosted by the fact that other major beef-producing countries around EU are also forecasting a relatively tight supply situation.

 

In total, beef production in the EU15 is expected to decline slightly around 7.1 million tonnes for the year.

 

While many countries recorded higher slaughtering during the first half of the year, lower numbers are predicted in the UK and Germany for the coming months.

 

Besides the fall in beef production, higher exports of beef and live cattle from the continent to international markets will also impact on availability within EU.

 

Driven by demand for forequarter beef in Russia, sales of young bull carcasses to Turkey and a surge in exports of offal products to Asia, beef exports outside of EU have risen strongly.

 

Live cattle shipments to North Africa and the Middle East have also increased dramatically, with France and Spain the main exporting countries, whereas, beef imports into the EU have declined significantly in comparison with recent years.

 

Imports for the January-April period totalled just over 100,000 tonnes, down 25% on last year's figures and 65% below the high import volumes seen in 2007.

 

Brazil, Uruguay and Argentina all recorded decreases of 25-35%.

 

These three major South American beef producers collectively account for almost 80% of EU imports, although their impact has been lessened through a combination of reduced availability, stronger domestic markets, higher cattle prices and demand from other markets, such as Asia and the Middle East.

 

Bord Bia has compiled a series of information leaflets regarding beef price prospects, dairy calf to beef and the type of animal required to achieve top prices.