The premium over English markets has increased to around 10p/kg
Scottish prime cattle prices have increased their premium over English markets as supply tightens.
Prices have shown a ‘modest increase’ in the past few weeks and were 10 to 11 per cent higher year on year, according to Quality Meat Scotland (QMS).
Supplies historically tighten during April and May and Stuart Ashworth, head of economics, said throughputs had fallen.
“Carcase weights are also falling so the volume of beef produced is lower than last year,” he said.
In England and Wales, Mr Ashworth said prime stock prices had ‘lacked direction’ as the market was slightly better supplied. The premium in the Scottish market was 10p/kg deadweight for an R4L steer, compared to 3-4p/kg in February.
Prices were boosted by the exchange rate with prices in the main European beef-producing countries increasing at a ‘more modest rate’.
“When converted to Euros, the UK price increase of 0.5 per cent mirrors the general state of the EU market,” he added.
“UK farmgate prime beef prices remain some of the highest in Europe with only Sweden, Italy and Greece having higher prime beef prices.”
Passing higher farmgate prices down the chain has been a challenge for wholesalers, according to Mr Ashworth.
While retail prices for food increased year on year by 1.2 per cent, average beef prices were very similar to March 2015, according to the Office of National Statistics.
Some of the more expensive retail cuts are cheaper than last year but cheaper cuts were more expensive which led to some consumers switching from roasting joints to stewing beef and mince.
“Overall, because for the past six months beef prices have been lower than they were during the equivalent period a year earlier, there has been some growth in retail purchases of beef,” he said.
For lamb, prices were higher year on year which led to lower sales. Pork and poultry prices have fallen with poultry meat demand increasing.
Mr Ashworth added any significant increase in retail beef prices would be likely to limit sales and farmgate prices would remain sensitive to the number of cattle, and volume of beef, on the market.