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AHDB Cattle and Sheep Weekly

20 July 2015

AHDB Cattle and Sheep Weekly - 20 July 2015AHDB Cattle and Sheep Weekly - 20 July 2015

Another hike in cattle prices

In week ended 11 July deadweight cattle prices moved up notably again.

The upwards pressure in the trade again comes from the tight demand/supply balance, driving robust competition from processors looking to ensure their factories are kept busy. At 31,900 head, AHDB estimates suggest that numbers were just ahead of the week earlier but again ahead of year earlier levels, for only the second week since the end of April. It is likely that the rise in numbers has been as a result of the robust demand from processors rather than anything else.

With reports suggesting that the trade in Scotland is setting the tempo, amid particularly tight supplies, the GB all prime average was up another 4p on the week. It broke through the 350p/kg threshold for the first time since late March, at 353.3p/kg . While it has strengthened almost 30p over the past eight weeks, it is worth remembering that prices were at a particularly low level earlier in the year. However, they have moved to be well above the five-year average in only a matter of weeks.

Steers meeting target specification strengthened 6p on the week to average 365.5p/kg, while R4L heifers were up 5p at 363.2p/kg. R3 Young bulls were 4p dearer at 345.7p/kg. With penalties for out- of-spec cattle having been less harsh in recent weeks, particularly for over age young bulls, prices have converged closer to those of other prime cattle. In early March the differential between the average steer price and the average young bull price was as much as 36p/kg. In the latest week it was just 14p/kg.

Competition in the cow trade was robust again. Demand for the better finished, heavier cows continues to be driving the momentum in the trade. At 240.7p/kg the average cow price was up another penny on the week earlier, -O4L cows achieved 259.3p/kg.

Liveweight lamb prices resume their downward trend

The liveweight lamb trade at GB auction marts has fallen once again as numbers coming forward increased.

Following gains seen in the previous week, the NSL SQQ fell by 6p to 157.2p/kg in the week ended 15 July. This increased the difference, compared to 2014, to almost 21p, as prices at this time last year were more stable. Sharper falls were seen towards the end of the week, with prices on Wednesday 15 July down by almost 9p compared to the previous week at 154.0p/kg.

Prices have eased following much higher numbers coming to markets. Throughputs were up by 19 per cent on the previous week, tipping the supply and demand balance in favour of supply, while the weakness of the euro continued to impact on returns. The numbers forward were over 40 per cent higher than levels seen in 2014. It is possible that the increase in prices last week encouraged some producers into marketing their lambs.

Deadweight prices continued to fall in week ended 11 July as numbers were also up on the week earlier. However, the fall was less than seen in previous weeks. The deadweight SQQ fell by less than 3p on the week to 346.5p/kg to be at its lowest level at this time of year since 2010. However, the smaller fall seen this week has meant that the difference compared to 2014 has narrowed to around 70p, because the trade was falling much sharper at this time last year. Following a further increase in the all prime average deadweight cattle price, the deadweight SQQ is now almost 7p below the average price for beef sold direct to abattoir.

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