QMS reports rise in price of prime beef
A short supply of cattle in the UK and Ireland is driving the prices of prime meat up, according to Quality Meat Scotland (QMS).
Recent slaughter figures show that Scottish abattoirs handled 6% less cattle than they did in May last year and auction market throughputs suggest the drop has continued through June. However, the slaughter of prime cattle in Ireland, according to QMS’ head of economics services Stuart Ashworth, are almost 20% lower than those of May and June last year.
Currently demand for Scottish beef is high and prices have risen 12% above what they were last year, Ashworth explained. He said: “Producers and processors are both watching the market with interest — producers in the hope that current prices can be maintained and processors in the hope that they begin to ease. Ultimately, supply and demand will win the day.
Ashworth said that now the “Olympic effect” on beef demand had passed, as it’s four weeks to go and suppliers are likely to have secured their meat, producers should hope for an improvement in the weather to “stimulate barbecue demand”, but also an improvement in consumer confidence in the wider UK and European economy.
The biggest driver of prices, according to Ashworth, will be changes in cattle availability rather than high demand in late summer and early autumn this year. Registration of Scottish calves has increased dramatically over the last four years, but slaughter numbers this year have so far been lower than calf registration figures suggest they should be.
Ashworth said: “A closer look at slaughter volumes reveals some interesting differences. While the overall Scottish prime kill has fallen 9% over the first five months of the year, the biggest change has been in young bulls, which are down 30% followed by heifers down 10% while steer numbers have only fallen 6%.”
The reduced amount of heifer slaughterings stands at 13% for the end of May and could carry on, as the prospect of increased breeding and heifer retention lowers the amount of stock going to slaughter. Abattoirs in England and Wales have also seen a similar decline in prime stock numbers. Ashworth said: “On the evidence of calf registrations, census results and recent slaughter volumes, it seems likely that, across the UK as a whole, there are slightly more prime stock in the supply chain than this time last year.”
Ashworth pointed to something similar happening in Ireland, explaining their December census showed an increase of cattle under the age of one by 10%. However, he noted that the bad summer weather had impacted livestock growth rates at grass, which delayed their arrival to market.
Ashworth said: “While there may be some short-term increase in cattle supplies, this must be put in the context of 2011 calf registrations, which were no better than they were in 2008 and are 9% below their 2004 levels. Hence, taking a longer-term view, the market looks set to remain tightly supplied.”
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