Prime cattle prices firm but remain 8.5% below last year's levels
Prime cattle prices have firmed slightly, but still remain 8.5 per cent below levels last year, with increased volumes weighing on the markets.
According to Quality Meat Scotland (QMS), one of the contributing factors behind the downturn was a general increase in supply, with the total volume of beef available in the UK rising over the past four years.
Iain Macdonald, QMS senior economics analyst, said overall supply rose by another 3 per cent in 2018, with a 5.4 per cent increase in exports unable to offset a 2.2 per cent lift in domestic production and a 6 per cent rise in imports.
Significant
“This is likely to have resulted in a significant carryover of stocks into 2019,” he said.
Beef production grew further in the first half of 2019, driven by higher prime beef production with throughputs up 0.5 per cent and carcase weights up 1.2 per cent.
A near 2 per cent reduction in cow slaughter was offset by a similarly sized rise in carcase weights.
Although UK exports rose by about 8 per cent and imports contracted by a similar degree in the January to May period, this was not enough to balance the market.
Demand
Consumer demand has also acted as a significant headwind with the weather altering the balance of sales.
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“Last year, the sales of fresh and frozen beef and burgers showed an unchanged level of spending at GB retailers compared to 2017, with ideal barbecue weather boosting sales of steaks and burgers,” said Mr Macdonald.
But this dropped in the 12 weeks to mid-July in 2019, as a sharp reduction in burger and steak demand ‘more than offset’ recovery in roasts, stewing beef and mince.
In Scotland, the bias towards spring calving and peak supply in winter months meant weekly slaughters have been dropping back.
“Last year saw an overall decline in calf registrations of 2.6 per cent, driven by a 2.9 per cent reduction in beef-sired calves,” he added.
“This signals a likely tightening of supply relative to 12 months earlier towards the end of 2019 and into 2020 when these calves reach finishing weight.”
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