Cattle and sheep markets record a strong Q1 performance

24/04/2018

Aberdeen & Northern Marts Head of Livestock John Angus, Deputy Head of Livestock Colin Slessor, and Tim McDonald, the company’s Prime and Cull Cattle Manager, report on the strong performance of the cattle and sheep markets during the first quarter of 2018.
 
Cattle Market Overview (John Angus)
 
Demand for all classes of beef cattle – prime, cull and store – has held up remarkably well in the first quarter of the year, despite unfavourable weather over the winter, and the high price of fodder and straw and the late spring.
 
As a leading farming co-operative, we are particularly pleased that prime cattle prices have firmed up – a good six weeks earlier than usual – and it’s encouraging that there is no backlog typical at this time of year of cattle waiting for slaughter. We expect prices to keep on rising in the coming weeks, which is good news for finishers and could easily rise another 10p/kg by June.
 
Slaughter weights are generally 30-40p/kg lighter to meet the tighter specifications imposed by most abattoirs with, perhaps, the unintended consequence of a significant fall in the total supply of beef coming to the market.
 
It’s pleasing that finishers have responded so well to the demand for lighter cattle and the imposition of lower maximum carcase weights by most abattoirs.  Adapting feeding regimes to meet the revised spec is working well and those previously handling cattle at the top end of the weight range are finding they can put through an extra batch over the year.
 
Reviewing the store market, the buoyant market for prime cattle helps everyone and is reflected in a strong demand for store cattle, with new buyers appearing around the ringside every week, despite the lack of early grass. We expect the market to remain firm, with smaller stores meeting a ready demand for grazing over the summer.
 
Buyers from England are already active and happy to pay a premium for quality cattle from the North East, which they know will go on and thrive.  It also means they avoid the hassle of TB restrictions in England.
 
One of the big advantages we can offer at Thainstone Centre is excellent lairage facilities which enable cattle to be kept overnight to fit in with haulage availability, and is appreciated by our customers.
 
Prime and Cull Cows Overview (Tim McDonald)
 
Consignors selling at ANM are certainly benefitting from the strong competition around the ring, with good prices achieved for finished cattle using the fair and transparent price discovery mechanism of the auction system.
 
Demand for ‘handy weight’ (500-550kg) well-finished heifers is particularly strong from meat wholesalers supplying specialist high-street butchers, hotels and high-class restaurants in London, who are prepared to pay a premium for high-quality cattle with a story behind them.
 
Unsurprisingly, the cull cow market is also ‘on fire’, and breeders are taking advantage of the strong market – up £120 – £140/head (14p/kg) on the year – to move on older cows and buy in replacement heifers.
 
Buyers are looking for well-fleshed cows to satisfy increased demand for cheaper cuts for processing into pies, ready meals and such like. Ironically, no weight cap applies to cull cows, and processors report that Limousin and British Blue crosses, in particular, are giving excellent meat yields.
 
Sheep Market Overview (Colin Slessor)
 
Turning to the sheep market, the strongly rising market for old season lambs has seen the auction ring come into its own recently, as prices have increased week after week.
We have seen a number of buyers around the ring we haven’t seen for a long time along with our regular buyers, which is an indication that abattoirs further South are short of supplies. In a rising market, the auction ring always leads the way. This is the strongest spring market for sheep we have seen for many years and certainly positive news for the industry. 
 
In the run-up to Easter – when demand for lamb is traditionally strong – QMS figures show that prices were 30% ahead of the same time last year. This was borne out at Thainstone on March 29 when 6,535 lambs recorded a record trade of £2.44/kg, up 67.4p/kg on the same day last year, averaging £106/head for 45kg lambs compared with £30.33p/head last year.
 
Many of these lambs will have been bought in the trough of last autumn’s store trade when prices were down £5/head on the year. Finishers have enjoyed the double benefit of a lower purchase price and a high sale price which will have boosted margins and should augur well for this year’s autumn store lamb sales.
 
Trade is being driven by a combination of strong demand, both on the home market and for the export market to France, and reduced imports from New Zealand in February. With recent high prices drawing lambs on to the market, supplies are expected to remain tight through April and May which suggests the market will remain firm.
 
Cull Ewes (Colin Slessor)
 
The cull ewe trade has also been rising sharply, with Texel ewes at Thainstone selling to £200/head, Suffolks in the £140 to £170 range and Mules over £100.
 
Ewes with lambs at foot have been slow to come forward due to the shortage of grass but a strong demand is expected with the weather now turning and the grass beginning to grow.
 
The only downside is the recent cold, wet and sometimes snowy weather we have been experiencing through the lambing season, with hill lambing just about to start, and reports of a high loss of lambs on some farms which have been hit particularly hard.
 
However, many farms are reporting a good lambing season with strong lamb numbers and we are hopefully beginning to see a welcome revival in the fortunes of sheep farmers.
 
Upcoming Cattle and Sheep Shows and Sales
 
Our annual show and sale of commercial breeding cattle will be held at Thainstone on Tuesday, 1st May, which as usual will run alongside our multi-breed show and sale of pedigree beef bulls.
 
This sale always attracts a high-quality offering of young cows and heifers, many with calves at foot, and this year will be no exception. Shortage of fodder means some breeders have been holding off buying replacement females until more grass is available and we would anticipate a good demand for breeding stock.
 
On the sheep front, our show and sale of Suffolk and Suffolk cross prime lambs will take place on Wednesday, 10th May, at Thainstone and many top-quality lambs will be showcased and available for sale afterwards.
 
With the weather taking a turn for the better with higher temperatures and good grass growth, we will continue to see a strong turnout in buyers at our sheep shows and sales.