'Perfect storm' hits store cattle prices

John Angus, ANM's Head of Livestock, selling cattle at Thainstone
John Angus, ANM's Head of Livestock, selling cattle at Thainstone

The unprecedented spell of hot and dry weather since mid-May and concerns about lack of grass growth and future supplies of fodder, coupled with an easing of finished cattle and sheep prices, combined to create the ‘perfect storm’ in early July, resulting in a sharp fall in store cattle prices at markets throughout Scotland.

The impact was keenly felt at the weekly store sale at Thainstone on the ominous date of Friday, July 13, when the number of cattle offered for sale doubled compared with the corresponding sale last year and the hesitancy of buyers concerned about soaring fodder and straw costs resulted in prices falling dramatically.

Bullocks (732) averaged 210p/kg, 37.4p/kg down on last year at this time, and heifers (678) averaged 205.9p/kg, down 35.5p/kg.

“Smaller cattle for longer keep were hit hardest of all while bigger cattle over 480kg with good fleshing fared better,” said auctioneer, John Angus, ANM’s head of livestock. “Lack of grass is forcing many farmers to put their cattle on the market while potential farmers have increasing concerns about the availability and cost of fodder.”

Mr Angus is hoping the recent rain in most areas will see an improvement in grass growth and put the industry back on an even keel.

“It’s amazing the effect a good shower of rain can have,” he said. “Farmers might be flush with grass in a couple of weeks’ time.”

But he is concerned about the acres which are being lost to food production and being used to grow rye for the growing number of anaerobic digestion plants in Scotland.

“This is becoming a real problem for the livestock industry and has taken thousands of acres out of food production,” he said. “The price of straw has gone through the roof and farmers are having to compete with an industry which enjoys a double subsidy – an area payment to produce the feedstock for the AD plant and the feed-in-tariff for the electricity produced.”

The re-adjustment of the market is likely to have an impact for some time but already there are indications that buyers and sellers have come to terms with reality of the current market which is a direct consequence of recent weather and concerns about future fodder supplies.

The market is showing some signs of improvement and trade at Thainstone on July 20 was slightly up on the week although very few cattle were on offer, with 56 bullocks averaging 216.9p/kg (+6.9p) and 32 heifers 209.4p/kg (+3.5p).

“We had plenty of buyers round the ring and more could have been sold to advantage,” said auctioneer, Tim McDonald. “Lack of fodder is the challenge but there are plenty of people looking for cattle.”

Hopefully, the market will have improved by the time of the next show and sale at Thainstone on Friday, August 10. The countryside was already showing signs of greening up at the time of writing as a result of heavy showers of rain in many areas which will do much to stimulate grass growth.

The ANM auctioneering team looks forward to meeting customers at the Black Isle, Turriff, Grantown, Orkney and Keith shows where the ANM caravan will be present. Come along and enjoy a cup of tea or coffee and discuss the market situation and prospects for this year’s autumn sales.