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© AdobeStock/david hughes It was perhaps inevitable that store cattle prices would edge back, given the level of inflation in costs faced by beef finishers. So, although deadweight beef

prices are running nearly 10% higher than a year ago, store cattle values are now at the same level they were 12 months ago. Is this now going to be a typical theme for farmers: higher

farmgate prices, but lower profit margins due to alarming inflation in our production costs? ABOUT THE AUTHOR STEPHEN CARR _Farmers Weekly Opinion writer_ Stephen Carr runs an 800ha beef,

sheep and arable farm on the South Downs near Eastbourne in Sussex in partnership with his wife and four of his daughters. He also runs a nearby pub with his nephew, The Sussex Ox, which

serves the farm’s beef, lamb, (and fruit and vegetables from the farmhouse kitchen-garden in season) through its restaurant. For me, news that store cattle prices have dropped back is

irksome as I took the plunge and bought 70 stores for fattening at very fancy values last autumn. At that time there was general euphoria in the air about the good prices for finished cattle

that had lasted right through 2021. See also: Find our market price information in one place But last October now seems like a very long time ago as the cost of fuel, feed, fertiliser and

machinery has skyrocketed, and we brace ourselves for huge hikes in all energy prices in the coming months. Given that farming costs and commodity prices are now generally rising at rates

not seen since the 1970s, most of us are in very unfamiliar trading territory. My three farming enterprises – beef, sheep and arable – are in the same boat: excellent revenues from sales,

but terrifying conversations about the cost of everything I buy from agricultural merchants and engineers. To take one example, I have recently ordered a mobile cattle handling system as the

bovine-TB testing of our 300-strong herd of pedigree Sussex cattle has become ever more regular due to changes the government has made to the testing regime. I needed the crush delivered

quickly, but was shocked to discover that, before the UK manufacturer would accept my £20,000-plus order, I had to agree an unspecified potential increase in the quote depending on what they

had to pay for the steel to make it. This is the first time I have ever agreed to such terms when ordering farm equipment and is surely tantamount to signing an open cheque. I nervously

await delivery next month. I say that all my farm enterprises are experiencing similar cost-price pressures, but I think the arable enterprise is under the most intense strain. > A 

farming friend recently described arable farming as having become > “a financial treadmill” The problem with arable farming is that it’s very difficult to cut back on expenditure as

economising on a single input, whether it be seed, fertiliser, herbicide, fungicide or insecticide, can horribly compromise the yield of the crop. This is why a farming friend recently

described arable farming as having become “a financial treadmill”. Extensive beef and sheep farming, on the other hand, is more open to economies being found to combat a cost-price squeeze.

If times are hard, the traditional route is to keep extensifying the grazing ever further to reduce costs. If there is less stock on the farm, fertiliser purchases can be cut, less hay made

and less winter feeding done. So at least I have some scope to cope with the intense pressure on what are already thin profit margins on my farm. All of my cattle are native breeds,

including the stores I bought last autumn. And I’m using a native terminal tup, a Southdown, on an increasing number of my North Country Mules. These breeds know how to make do during hard

times. Farmers may now have to show the same trait.