The deadweight cattle trade has continued to come under pressure in Northern Ireland this week.
Base quotes for U-3 grade prime cattle have fallen to 308- 318p/kg, bringing base prices to their lowest recorded level since May 2016, according to the Livestock and Meat Commission (LMC).
“The beef market across the EU has come under severe pressure due to the COVID-19 crisis.”
“The loss of key foodservice and catering markets for beef, in particular, have had a negative impact on the trade and created carcase balancing issues for processors.”
The LMC spokesperson pointed out that foodservice markets provide a valuable outlet for high-value cuts, in particular, and there has been a notable drop-in demand for these products as a result of the ongoing Covid-19 restrictions.
“Reports have indicated that some of these higher-value beef cuts have been put into cold storage while some has been redirected to other less valuable market outlets.”
Factors contributing to downturn
They said this shift in market demand, combined with a reduction in the value of fifth-quarter products, have been key contributory factors in the recent downturn in the deadweight beef trade.
“While there was an initial spike in demand for beef from the retail sector due to consumers panic buying, this has now levelled off with reports indicating that demand for beef is returning to more normal levels.”
While the increase in demand for beef has been welcomed over the last few weeks, the increase has not been enough to offset the loss of demand from the foodservice market, the spokesperson added.
Beef quotes slashed
The spokesperson added that due to the time lag between cattle being bought, processed and then price reported, the downturn in the deadweight trade for prime cattle is only now being reflected in official figures – both here in Northern Ireland and across the rest of the European Union.
The R3 steer price in Northern Ireland last week was back by a further 5p/kg to 328.9p/kg which brings the reported price to its lowest level since November 2019.
“With further reductions in base quotes, reported prices are expected to be back further next week.”
The R3 steer price in Great Britain last week was back by 6.1p/kg to 335.2p/kg with decreases in prices reported in all of the regions but particularly in the Midlands and Southern England where prices fell by 8-9p/kg.
In Ireland last week, the R3 steer price was back the equivalent of 10.6p/kg to 303.3p/kg.
“This is the third consecutive week, in which, it has declined in sterling terms and widens the differential in R3 steer prices with Northern Ireland to 25.6p/kg.”
Deadweight prices have also recorded declines in the EU with an average R3 heifer price of 353.1c/kg (312.1p/kg) last week.
“This was back by 4,4c/kg from the previous week and was the sixth consecutive week in which the R3 heifer price has recorded a decline.”
While deadweight heifer prices declined in almost all EU countries last week, the strongest declines were recorded.” the LMC concluded.