Beef: rising numbers falling prices

Farmers are filling sheds and offloading cattle that they don’t want to keep over winter. This is putting pressure on the market, as waiting lists start to appear at abattoirs. Many farmers are booking cattle in two weeks ahead. This may drive more cattle reaching maximum weight to the live ring.

The official price reported by AHDB is £3.85/kg for R4L steers with farmers being quoted 5p to 10p less per kg for continentals.

This is a fall of 6p on the week for the reported price, as the number of steers in Scottish abattoirs rose 8.2% on the week. Same grade heifers are reported at £3.84/kg, which is a fall of 5p on the week with numbers rising 4.7% week on week.

Abattoirs that offer a shorthorn premium are still being reported as 25p/kg; while the Angus premium has fallen dramatically, from highs of 25p/kg a few weeks ago to 5p to 10p/kg this week.

Meanwhile, the United States Department of Agriculture (USDA) has projected a rise in global beef and veal production of 2% in 2018.

They state that the USA and Brazil are likely to be responsible for half the uplift to 63m tonnes of global production.

This comes off the back of four years of growth in the US herd. The weakened dollar has boosted exports to Mexico, Canada and East Asia.

The Australian herd has also grown, contributing to global beef supply. The USA and Australia are battling for market share in Japan as Australia’s tariffs fall and USA tariffs rise.

The USDA believes that Brazil production will to rise 3% on the year to 9.7m tonnes in 2018. The country seems to have recovered from allegations of unsafe meat processing earlier in the year, which knocked exports.