Inside: Milk & Food

Slaughter cow prices resist LU scheme

17 March 2017 - Herma van den Pol

Prices of broiler cows appear to resist the LU scheme in dairy farming unexpectedly well. An arrangement whereby not only the worst cows have to be disposed of, but also cows that normally should have been allowed to stay. Exports also appear to play a role in this. More in an analysis for the insiders of Boerenbusiness.

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It's interesting to see how slaughterhouses react 
The large numbers were anticipated, but nevertheless it was still exciting to see how the market would respond to the larger slaughter numbers. This was influenced by the fact that slaughterhouses had not previously had to process such quantities. A challenge not only for slaughterhouses but also for those further down the chain, such as deboners.  

Prices higher in Germany and Belgium 

After two weeks of lower prices, Vee en Logistiek achieved stable prices for week 10. Bunnik and Leeuwarden followed in week 11. In Bunnik the number of animals fell from 161 to 149, while the number of animals in Leeuwarden increased from 838 to 902 animals.

The livestock markets therefore only account for a relatively small number, but still provide insight into prices. There are also reports from the trade that the slaughter cows are selling well, which supports the stable price. It helps that prices in Germany and Belgium are above those in the Netherlands. It could also provide support in the coming weeks.

New players in cow slaughter 
Cows for slaughter not only find their way to Dutch slaughterhouses, but Belgium and Germany are also mentioned. It is striking that a company like Vaex has also entered the cow slaughter business. Another player estimates that in addition to the gigantic slaughter figure in the Netherlands, another 2.500 cows were sent across the border to slaughterers.   

150

euro

bottom price pink

In the meantime, efforts are being made to remove the better cows that are offered via export from the market. The human side of the story also plays a role, because sending good animals to slaughter is the worst scenario for a dairy farmer. As a result, there is a price of 150 to 350 euros for heifers. Low prices because there is suddenly a lot of demand for them due to the GVE scheme, while previously hardly any heifers left. It is a factor that dairy farmers try to keep as many lactating cows as possible. Heifers are more likely to cost around 800 euros.

Collecting cows for export is not possible
In the meantime, the Phosphate Reduction Regulation 2017 is also causing problems for the export of cows. More specifically, the reference date is December 15, 2016, which also applies to livestock collection sites and places where animals are isolated as part of the required quarantine. As a result, cows cannot be collected for export to distant destinations, because there is no reference. This makes long periods of isolation necessary for markets such as Russia and Kuwait impossible, especially now that exports are desperately needed.     

A solution to this is not yet in sight, because this is separate from the beef cattle issue. A difficult hurdle now that the date of April 1 is quickly approaching. Turkey is only mentioned as a market for bulls.  

Check out the slaughters and cattle prices

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