Beef Prices Strengthening
Since the start of September beef prices have strengthened after two months of tumbling trade. Warmer weather at the start of the month, back to school demand and a continuing tightening of supplies have led to processors increasing prices in order to secure cattle.
Prices have been increasing steadily since the start of September, with finishers receiving an increase of approximately 20p to 30p kg/dwt. Currently prices are sitting around 493p/kg deadweight, with reports that certain processors are offering more in order to secure supply.
Numbers are tight so finishers who can supply the right numbers of cattle to the right spec can get £5/kg deadweight.
Prices being driven by Supply
Shortage of supplies continue to be a driver behind the finished beef price. As the Scottish beef herd is declining, so too are finished cattle supplies. The reduction in young cattle in England and Wales has continued strong demand for Scottish born calves, with stores sales strongly supported by English buyers, contracting cattle numbers available for slaughter in Scotland further.
Reports suggest on the back of the falling beef price throughout the summer months that finishers offloaded their ‘September supplies’ early, further reducing availability. Going forward it is highly likely that finished prices will continue to increase as processors compete in order to secure cattle with Christmas now on the horizon.
With rising prime cattle prices, store cattle prices have also risen in recent weeks, with prices up around 45p/kg liveweight from this time last year. Trade for store cattle has been strong, as finishers invest their returns in the store ring. .
Going forward it is anticipated that store trade will continue trending upwards and is already moving in the direction of the high levels witnessed in the spring.
Markets have reported a buoyant trade for weaned calves in recent weeks, with Aberdeen & Northern Marts, Thainstone, reporting a sale average of £1419.92 (up £245.51 compared with 2022) for their first weaned calf sale. It is anticipated with the beef price rising and feed prices less this year that suckled calves will be in greater demand, after a depressed trade last year.
Cull cow trade has also come back up in recent weeks. Warmer weather at the start of the month and the Rugby World Cup have increased demand for BBQ meat after weakened demand throughout the summer. Prices may not improve further, as numbers generally pick up at this time of year ahead of housing and weaning. Those with cows to go would be advised to sell now and take advantage of the current price.
Falling suckler cow numbers remains a concern for the industry. UK numbers falling on average by 1% each year. England has ~ 750,000 cows and Scotland has ~ 400,000 suckler cows (a reduction of 2.5% since 2018). France now has more pure bred Charolais cows, than the total UK beef cow herd!
Recent data released from BCMS shows that suckler born registrations have fallen this year by 3.5%, highlighting the importance of beef from the dairy herd in beef production.
With registration of Limousin X, Charolais X and Simmental X calves showing ; reductions of up to 7%, in comparison to breeds such as Aberdeen Angus X and British Blue X who continued to grow in numbers; it will be interesting to see at the Autumn Bull sales if breed sale averages are less for the breeds with falling calf registration numbers.
Sarah Balfour, email@example.com
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