Why are cattle so dear this year?

krazyfarmer

And where is the money coming from to buy them?
The banks must be lending to some people.

whelan1

some one said to me today that as the peoples money isnt safe in banks they are buying livestock

keep going

talk about out of the frying pan and into the fire.i think im going to set up a stand at the mart selling bulgarian appartments, reckon they fly

pakalasa

Lots of reasons from what I can see.

- Cattle normally get dear this time of year anyway. With the cost of wintering etc, it makes sense that they should.
- Most beef production is related strongly to the price of oil. High oil means more expenxive diesel, fertiliser, silage wrap, tarnsport....the list goes on and on.
- A lot of cattle, and not just weanlings, were exported outta the country in recent years. Cattle are simply scarce.
- Rumours about how the single payment will pan out with reference years etc, have farmers trying to up their stock numbers again.
- More cattle are now being killed outta the sheds in early spring. Some of these are going on 3 years. Farmers have to re-stock again at this time of year.

reilig

Exports

For the last 6 months the 5 marts within a 20 mile radious of me have been thronged with export buyers. Last october when I was selling Belgian Blue weinlings, there was one dealer who had come over from the UK there and he bought every blue heifer in the place - no matter who was bidding against him or what price he had to pay for them. Every weinling mart that I go to, there's 2 or 3 double deck lorries waiting to be filled. These guys are buying the best animals at the marts and paying the best prices. They don't stand around the ring waving their hands and trying to claim cattle - most of them will sit up in the seats and buy what they want to buy regardless of price - A different class of dealer but a welcome.

These guys have orders that they have to fill and they have money to spend and in my personal opinion, they are the best thing to happen to Irish Agriculture in years - everything that can be done, should be done to ensure that cattle exports continue at this level from this country.

krazyfarmer

While I agree for the most part with all above comments. And welcome
increased prices for farmers.
I don’t understand how the ordinary small - medium sized farmer can afford to pay current prices. Do they really think beef prices will rise to cover these high costs? I don’t!
On the point of your money not safe in the bank. If you invest it in livestock and the banks or the country fail. I don’t believe your investment is any safer in the field than it was in the bank.

krazyfarmer

I have sold a good number of cattle to the factory in the last few months.
I had planned to restock using this money. So far i havent bought any cattle this year. I think they will lose money.

reilig

krazyfarmer wrote: »

I don’t understand how the ordinary small - medium sized farmer can afford to pay current prices. Do they really think beef prices will rise to cover these high costs? I don’t!

I don't think beef prices will rise either.

So, its time for the ordinary small - medium farmer to have a good look at what they are doing.

Sadly a majority of them aren't making any money. Many are spending their SFP and their REPS on over priced cattle that rarely leave a profit and some do not even return the amount invested in them.
This ensures that the system is a mess for everyone. Laggy Goodman gets €5million in a single farm payment. He also has all of the cattle that he buys off farmers at a below cost price because they are subsidised by the SFP. Larry and the other meat factory owners along with 3 or 4 big supermarkets are the only winners out of it.

I know its harsh words, but if people think that cattle are too expensive to buy and they will not return at least a 20% profit on the total investment, then don't waste your money buying them.

Look at alternatives like leasing your land, growing crops, forestry, breeding cattle or sheep.

Why would anyone be foolish enough to buy something that they are fairly sure they will make a loss on.

If people need to get rid of excess cash, pm me for my postal address. I'll gladly take it.

EDIT: Remember you can get up to 5% return on savings over 12 months with some banks (even with some of the foreign banks that some people might see as a safer investment)

Tipp Man

reilig wrote: »

I don't think beef prices will rise either.

So, its time for the ordinary small - medium farmer to have a good look at what they are doing.

Sadly a majority of them aren't making any money. Many are spending their SFP and their REPS on over priced cattle that rarely leave a profit and some do not even return the amount invested in them.
This ensures that the system is a mess for everyone. Laggy Goodman gets €5million in a single farm payment. He also has all of the cattle that he buys off farmers at a below cost price because they are subsidised by the SFP. Larry and the other meat factory owners along with 3 or 4 big supermarkets are the only winners out of it.

I know its harsh words, but if people think that cattle are too expensive to buy and they will not return at least a 20% profit on the total investment, then don't waste your money buying them.

Look at alternatives like leasing your land, growing crops, forestry, breeding cattle or sheep.

Why would anyone be foolish enough to buy something that they are fairly sure they will make a loss on.

If people need to get rid of excess cash, pm me for my postal address. I'll gladly take it.

EDIT: Remember you can get up to 5% return on savings over 12 months with some banks (even with some of the foreign banks that some people might see as a safer investment)

Not always so simple Relig

What about the huge tax bill you will get if you sell 150 cattle and don't replace them??

blue5000

There is a lot of unrest in the middle east, Some ppl are old enough to remember when Irish factories sold beef to both sides in the Iran v Iraq war.

Napolean said "An army marches on it's stomach"

Cattle numbers are down as already said, another reason for it is when su cow premium was halved and dis area was cut a lot of small suckler farmers got out, some of these are now trying to buy cattle, where they used to rear their own.

Also farmers who quit dairying are trying to buy cattle too. Intensive Dairy guys have put cows in calf to jersey, nobody wants these so there are a few less male calves coming off dairy farms.

reilig

Tipp Man wrote: »

Not always so simple Relig

What about the huge tax bill you will get if you sell 150 cattle and don't replace them??

Look at alternatives like leasing your land, growing crops, forestry, breeding cattle or sheep.

.

barryoc1

I was at a farming discussion group last Monday, speaker said why do people think cattle are so dear, afetr a bit of a pause, he then answered his question by saying, cattle are the new property game, and everyone wants to get involved by owning a few. Also because there are so many people with more time on their hands they are buying a few animals to stock places that they didnt care about in the celtic tiger years.

blue5000

Time to sell so while the market is bulling/bullish:D

irishh_bob

barryoc1 wrote: »

I was at a farming discussion group last Monday, speaker said why do people think cattle are so dear, afetr a bit of a pause, he then answered his question by saying, cattle are the new property game, and everyone wants to get involved by owning a few. Also because there are so many people with more time on their hands they are buying a few animals to stock places that they didnt care about in the celtic tiger years.

that comparison (property to cattle ) only applys if taxi drivers and shoe shine boys were to be seeing ringside in marts

Tora Bora

FFS, cattle aren't half dear enough:cool: All this talking down the prices:mad: Talking down coming from farmers in to the bargain:mad::mad:
What about price of fuel, feed, fertilizer, plastic, universal social charge to be charged on total sales revenue (not on net profit).

dryan

All this fine weather has alot to do with the high prices in the marts.

If the weather was to break and we were to get a few weeks of hard, cold, wet april weather, grass supplies wouldnt be long about tightening up and prices would come back.

Muckit

Tora Bora wrote: »

FFS, cattle aren't half dear enough:cool: All this talking down the prices:mad: Talking down coming from farmers in to the bargain:mad::mad:
What about price of fuel, feed, fertilizer, plastic, universal social charge to be charged on total sales revenue (not on net profit).

No Farmer (I think) has a problem with the prices for cattle going up, so long as they stay up and it's right across the board (calves, weanlings, stores, finished).

The problem is if it's short term someone along the chain gets burnt. The irish beef system doesn't lend itself easily to fools. In a primarily suckler to beef system, like in alot of other countries 'small bleeps' in price wouldn't cause as much tormoil

bob charles

Tora Bora wrote: »

universal social charge to be charged on total sales revenue (not on net profit).

are you certain on this, that is not equitable as you could be losing money on every animal sold. What margin do people work with when fattening animals?


Done abit of googling and im not finding any reference to the above, can you point me to a source