October 12, 2011

 

Irish beef prices affect live cattle exports

 

 

Live exports of cattle to Northern Ireland and the UK for the first nine months of this year due to stronger Irish beef prices.

 

Irish beef producers have been paid almost GBP0.06 (US$0.10) more by the processors in 2011 than their Northern Ireland and UK counterparts because of the tightening in supply to meet the demand of strong beef export markets this year.

 

The price advantage to Irish finishers is a reversal of the pattern in previous years during which the returns to Irish producers trailed the UK by up to GBP0.10 (US$0.16).

 

So far in 2011, the supply of steers to Irish factories is down by GBP0.133 (US$0.21) and the heifer supply is GBP0.078 (US$0.12) lower than for the same period in 2010.

 

For the first nine months of the year, live exports of cattle to Northern Ireland are down by almost GBP0.46 (US$0.72) and exports to the UK are back by GBP0.434 (US$0.68).

 

Some southern producers are continuing to sell into Northern Ireland because of a preference for the grading system in use by the factories there.

 

However, on price there is a benefit for Northern farmers to have their cattle slaughtered in the south.

 

Although beef prices have increased in both jurisdictions in 2011, the improvement in Ireland has been substantially higher than either Northern Ireland or the UK.

 

Year to date, R3 average heifer prices in Ireland are leading the UK market by almost GBP0.06 (US$0.09). Irish producers have been paid an average of GBP3.64 (US$5.66) per kilogramme (including VAT), an improvement of GBP0.157 (US$0.24) on 2010 prices, compared to GBP3.44 (US$5.35) per kilogramme in the UK where prices have increased by GBP0.096 (US$0.15) over 2010.

 

The average year to date price paid for R3 steers in Southern Ireland is GBP3.53 (US$5.49) per kilogramme (including VAT), an increase of GBP0.155 (US$0.24) on 2010 prices and GBP0.044 (US$0.07) more than the NI price for a similar grade. The average R3 steer price in NI for the first nine months of 2011 has been GBP3.38 (US$5.26) per kilogramme, an increase of GBP0.11 (US$0.17) on 2010.

 

The average R3 steer price in the UK has been GBP3.45 (US$5.37) per kilogramme, an increase of GBP0.099 (US$0.15) on 2010 prices, but trailing this year's Irish price by GBP0.026 (US$0.04).

 

Total live exports of finished cattle to all markets for the first nine months of 2011 is down by GBP0.31 (US$0.48) at 31,744 head, which is less than one week of the current Irish factory kill.