Beef factories have taken a ‘wait and see’ approach on prices for next week following the UK’s decision to leave the European Union.
Yesterday, 52% of the British electorate voted to the exit the European Union resulting in major fluctuations in both the stock and currency exchanges.
As a result Sterling has weakened considerably since the results of the UK’s position in the EU have become known, with Sterling falling to its lowest level in 30 years.
And, beef factories have reacted to the news with some of the major processors refusing to offer quotes for next week, while some are only quoting for Monday.
One procurement manager told Agriland that the industry would have to take stock following the UK’s ‘shock’ decision to leave the EU.
He continued to say that “we will have to wait and see what develops in the UK market over the next couple of days before setting next week’s beef price.”
Another procurement manager said that processors will be monitoring the situation in the UK very closely before quoting for next week’s cattle supplies.
Factories have also aired their concerns over the future of Irish beef exports to the UK, as a weaker Sterling makes Irish beef dearer to UK buyers.
According to Bord Bia, the UK was the main buyer of Irish beef in 2015, as it took 52% of all beef produced in Ireland valued at over €1 billion.
Already this year, the volume of Irish beef exported to the UK in January and February dropped 7.5% compared to the same time in 2015 due to changes in the currency markets.
Irish beef price suffers in the build up to Brexit vote
According to Bord Bia, the Irish beef cattle trade suffered this week on the back of strong supplies and uncertainty in the key export markets driven by exchange rate volatility in the UK.
It reports that steers were purchased at a base price of 405c/kg on the Quality Payment system, while heifers generally made a base price of 415c/kg.
The cull cow market was also weaker, it says, due to stronger supplies which seen O grade cull cows sell in the price range between 315-325c/kg.
