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Store cattle prices rally, on finished prices and tighter numbers
Thursday, 20 August 2020
Store cattle prices have been rising in recent weeks, with almost all types and ages showing gains. Rallying prime finished cattle prices are stoking the stores market, driven by tightness in supply of cattle on the ground, and good demand from processors. The eating out market is starting to move again following the prolonged period of lockdown, although caution among some consumers remains.
After spending much of 2019 and the first half of 2020 below the 5-year average, store cattle prices are now in positive territory against that longer-term measure. In the week ending 15 August, data from the LAA and IAAS showed prices of Hereford cross animals were between 8% and 21% higher than year earlier levels. Yearling steers averaged £655/head (+8%), while 2 year old steers averaged £991/head (+21%). Price gains for continental cross animals were slightly higher, ranging from 10% and 12% higher than year earlier levels. Yearling steers averaged £877/head (+12%), while 2 year old steers averaged £1062/head (+12%).
Finished prices are undoubtedly firm at the moment. The number of cattle on the ground close to slaughter age is lower than in 2019, both here and in Ireland. These GB population figures might explain the current strength in price of older stores in particular. For more information have a look at our beef outlook for 2020. As always, current finished price levels are no guarantee of prices in the future. The price paid for store cattle today will be a key determinant of future profits when they come to be slaughtered, along with cost management in the meantime.
Just a reminder: Buying in livestock can be risky and is the most likely way of introducing a new disease onto your farm. The cost of a disease outbreak can be huge. There are many potential diseases of concern as this checklist shows. The fewer red marks on the list, the lower the risk of buying in disease. To minimise the risk of buying in disease, source stock from as few farms as possible and ask questions about health status.
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