The beef trade continues to be under pressure, with quotes back another 5c/kg on Monday morning.
Bullocks are working off a €5/kg base price, while heifers are being quoted at €5.05-€5.10/kg in most factories this week.
The general thinking is that quotes won’t go below the €5/kg barrier but all eyes will be on factories at the end of this week as to where next week’s quotes will start off.
Factories are still only lukewarm about cattle supplies.
It is hoped that the current spell of dry weather will boost barbecue demand across the UK and Europe and this in turn will boost demand for factory-fit cattle.
U grading bulls are back at €5.20-€5.30/kg and R grading bulls are being quoted at €5.10/kg in some instances, but €5.20/kg is still achievable for good well-fleshed bulls
O and P grading bulls are working off €4.90/kg to €5.10/kg. Under-16-month bull quotes are a similar trade to last week and being quoted from €5.00/kg to €5.10/kg on the grid depending on the factory
Larger, regular finishers are working 5-10c/kg ahead of these quotes.
U grading cows are trading anywhere from €4.80/kg to €4.90/kg, with plants most active for top-quality cows continuing to show a keen appetite for the right stock.
R grading cows are trading from €4.70/kg to €4.80/kg. O grading cows are at €4.50/kg to €4.60/kg, with P grading cows coming in at €4.20/kg to €4.40/kg depending on weight and flesh cover.
Rabobank has just released its market outlook for the global beef trade for 2023.
It highlights the softening in consumer sentiment and subsequent weaker beef pricing in late 2022 has flowed through into early 2023.
It also highlights the continuing pressure on consumer confidence and the impact that this will have on beef purchases.
The eyes of the world remain on China to see how consumer activity will pick up after a slow start out of COVID-19 lockdowns.
The Rabobank report anticipates that Chinese demand for beef will pick up in the second half of 2023, boosting global beef prices.
The US will be the other focal point. After setting records in both volume and value terms for beef exports in 2022, numbers are starting to show a big contraction.
The US beef cow inventory has dropped to the lowest point since 1962 and feedlot inventories also show a big decline in the number of feeder cattle placements.
The expected drop in US beef production will cause a redistribution of global beef supplies and an overall tightening in the market.
Global beef production is forecast to come in steady for the first quarter, with a 5% lift in Australian and 2% increase in Brazilian production, almost enough to offset declines in the US, Europe and New Zealand.
The supply picture through 2023 is forecast to remain tight as US production dips.