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AHDB Cattle and Sheep Weekly

13 October 2014

EBLEX Cattle and Sheep Weekly - 10 October 2014EBLEX Cattle and Sheep Weekly - 10 October 2014

Cattle Weekly

Some signs of stability in the beef trade

In week ended 4 October, the GB all prime deadweight average price edged modestly higher on the week, being up a penny to 348.4p/kg. The slowdown in the upward price movement for another week gives some indication that trade may be starting to level ahead of the onset of the Christmas procurement period.

Despite this overall trend, reports suggest that demand remains better and some processors have once again offered higher prices in order to secure adequate supplies. Despite the number of steers coming forward being broadly similar to the week before and well ahead of year earlier levels, in spec R4Ls increased a penny on the week to 360.0p/kg. R4L heifers were unchanged on the week at 356.3p/kg. In contrast, the overall young bull price fell 3p on the week to 324.5p/kg. However, bulls falling within the R3 specification increased 2p/kg to average 335.8p/kg, their highest price since early April. This differing trend suggests that penalties are still in place for bulls outside target specification.

The deadweight cull cow trade levelled again in the latest week, despite estimates suggesting that 600 more cows were marketed, compared with a week earlier. However, trading at auction marts this week has been more subdued, despite fewer cows forward, possibly a reflection of more difficult trading conditions in export markets on the back of the stronger pound.

Diverging trends in the Scottish cattle herd

The Scottish Agricultural Census has revealed that, in June, the total number of cattle in Scotland was back a fraction on the year to 1.79 million head. While the dairy breeding herd expanded, the much larger suckler herd, which is key to future prime beef supplies, fell again. The number of female beef cattle over two-years-of-age on the ground was back almost 2%, or 8,000 head, on the year. Indicative of the longer term tight supply situation, the number of female beef cattle between one and two-years-of-age was also reported to be lower on the year, as was the number of male cattle in this age bracket.

However, there was a sizeable increase in the number of male cattle over two-years-of-age, although this did not offset the decline in younger male cattle, as calf numbers were almost 1% back on the year. The modest fall in livestock numbers over the past year is not a surprise and can in part be attributed to higher costs reducing margins. Although part of a downward trend since the 1970s, the difficult winters of 2011/12 and 2012/13, along with the poor summer in 2012, may have further influenced decisions to cut back on numbers over this period. Since 2010, the beef breeding herd has fallen 7% or 42,000 head, while the dairy breeding herd is around 2% larger.

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