Teagasc Beef Budgets 2021
Amid all the hardships of the pandemic initially beef saw a real boost to retail sales and, with lower global supplies we've seen higher finished beef prices and consequently a very buoyant store and weanling trade. The Teagasc beef budgets, just released for 2021 cover 4 categories of beef systems
Aidan Murray, Teagasc Beef Specialist takes us through the Teagasc beef budgets which were just released for 2021 and cover four categories;
- winter finishing of steers
- weanling to beef for heifers and steers
- Bull Beef and
- a more extensive grass/forage-based autumn to autumn steer system
Weanling & Store Prices
One of the real positives of the last few months has been the trade for weanlings and stores. Looking across the categories that we record for the budgets, prices are up around 7% on 2020 prices. Categories such as 500-600kg steers and heavier bull weanlings 400-450kgs, were up 10-12% over the same period.
The consequence of the increase is that it will require a higher finished beef price to breakeven. Even though most of the budgets will use a high quality grass silage, meal price is up €60/tonne to €300/tonne on last year which will impact on the winter finishing of steers and to a greater extent the bull beef systems.
Winter Finishing Steers
In this budget we look at purchasing a 500kg Friesian or Hereford cross steer and a 530kg Continental steer and finish them on good quality silage plus 4-5kg concentrate and they achieve carcase weights of 326kg, 332kg and 375kg respectively.
Purchase price figures are taken based on Martwatch figures from August to mid September. Prices ranged this year from €1.97/kg, €2.26/kg and €2.55/kg for the three animal types. After costs, the breakeven selling price for the Friesian is €4.48/kg, €4.84/kg for the Hereford cross and €4.90/kg for the continental.
Weanling to Beef
This system looks at purchasing a weanling 300kg Continental steer and a 280kg continental heifer. The steer will be finished at 24 months with a carcase weight of 377kg and the heifer at 20 months before the second winter at 20 months. The target is to achieve a 296kg carcase for the heifer and a 377kg carcase for the steer. Purchase price for the steer is €2.94/kg or €882 and €3.07/kg for the heifer or €860.
After combined cost of €869 for the steer, the breakeven price for the steer at finish in the spring of 2023 will be €4.64/kg. The shorter-keep heifer incurs cost of €495 but she will need to achieve a factory price of €4.57/kg next autumn to cover all costs.
In a way, given weanling prices and the length of keep involved, this system is harder to estimate a potential return for as you are trying to forecast a high beef price in 12 to 18 months time.
Bull Beef System
The efficiency of bulls in terms of carcase grade, leanness, Killout % and feed conversion are well documented but some processors have a limited market and in times of good beef supply, age and weight limits are much more of a problem.
In Grange they have finished U16 month bulls on a good quality silage and 4-5kg of concentrate and this is replicated on the budget where we purchase a 320kg weanling bull at 320kg for €2.94/kg and finish them at 346kg in 7.5 months time to give a 346kg carcase. After costs, this system will require a breakeven selling price of €4.67/kg carcase next May/June.
The other two bull beef systems look at purchasing a 420kg bull weanling for €2.81/kg and feeding ad lib concentrates and finishing at either 385kg carcase or 421kg carcase. After costs, the breakeven selling price for these animals is €5.11 and €5.31/kg respectively. The higher purchase price and higher meal costs are really putting this system under pressure this year. Lower concentrate costs or boosting animal performance in terms of higher ADG to either improve carcase weight or shorten the keep on the farm will impact of the viability of this system.
Autumn to Autumn
Of all the budgets this is the most extensive in that it relies solely on performance from very good grass silage over the winter and good performance off grass before slaughter next autumn.
Three types of steer animals are purchased in this budget, a 350kg Friesian, 350kg Hereford cross, and 430kg continental with a purchase price of €1.70/kg, €214/kg or €2.61.
Animals are wintered on very good quality silage (70%+DMD) before turnout next spring and grazed right up to slaughter next autumn. There is a possibility to feed concentrate at grass for the last 60 days next autumn prior to slaughter but this would add approximately 14-17cent/kg to the breakeven price at current concentrate costs.
After all costs are included, the breakeven price required for the Friesian steer with a carcase weight of 309kg is €3.40, the Hereford with a carcase weight of 315kg needs €3.84/kg and the continental with a carcase weight of €4.26 will require €4.26/kg next autumn.
Of all the systems featured, the Autumn to Autumn offers probably the least risk to buyers and if they have very good silage and can exploit excellent performance, it minimises the need for expensive concentrate.
Listen to the Beef Edge Podcast below to hear more from Aidan Murray on Teagasc Beef Budgets
The Teagasc Beef Specialists issue an article on a topic of interest to suckler & cattle farmers every Wednesday here on Teagasc Daily
Read more about the Teagasc beef budgets here