The Livestock Auctioneers' Association Limited (LAA)

Trade Talk - Hexham & Northern Marts

30th May 2014

Having recently hosted the National Beef Expo the auctioneers at Hexham & Northern Marts have also enjoyed another busy spring sales period offering a combined total of 14,972 head of store and breeding cattle for sale by auction since the turn of the year to the end of May.

With the record breaking store trades of 2013 fresh in the mind no-one expected prime levels to fall as they did in the run up to Christmas. Whilst the short-term effect of 'horsegate' was a positive one for UK beef producers the undoubted long-term effect has been detrimental and this coupled with reported consumer resistance to the price of beef on the shelves has meant that breeders, feeders & finishers have all had to quickly re-evaluate their buy-in costs. This has resulted in a drop in value of both older, short keep store cattle and also, but to a lesser extent the younger, yearling and grazing cattle. These values this have consistently been 15-20% back on 2013 figures for forward stores whilst younger types, with the prospect of many months on the ground before finishing have only seen returns back by 6-10% equating to at worst perhaps a drop of £100 on the year.

Many purchasers would argue that these figures need to ease even more so to reach parity with finished prices and to sustain their margin in between however this in turn is met with the juxtaposition of breeders claiming that suckler cows were only starting to leave profit with calves selling at 2013 levels. Conversely and for perhaps no other reason than a shortage of supply these breeders have yet to see a reduction in replacement values with first calved outfits and bulling heifers selling to similar rates seen in the spring of last year with the best realising £2500-£2800 and £1400-£1600 respectively.

In search of a positive outlook for the short-term one might hope that a lull in supply before grass cattle come 'on-line' later in summer may well stimulate an improved price for our finishers. In addition we may also experience the all too elusive 'barbecue summer' which should in turn increase consumer confidence and spending. Despite current fortunes beef producers in our region and across the UK can rely on their local auction market to provide a professional service and a fair, transparent value for consignors and purchasers alike.

Chris Armstrong, Auctioneer
Hexham & Northern Marts.