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EBLEX 2009 Beef Market Outlook
11/02/09

Despite the recession, 2009 market conditions continue to look positive for most UK beef producers, according to the latest annual outlook from EBLEX Ltd, the industry body for beef and lamb levy-payers in England. And this following the best year’s prices ever recorded.

© www.jennifermackenzie.co.uk

cattle market

At an average of just under 260p/kg deadweight, AHDB Meat Services records show finished cattle prices in 2008 were a good 26% up on 2007 and more than 60% – or fully £1/kg – ahead of 1998. As predicted this time last year, this welcome strengthening of farmgate prices resulted from a continued decline in annual slaughterings coupled with increased exports and almost static import levels.

For the coming year prime cattle slaughterings are forecast to fall below 2 million head for the first time ever as both the national dairy and suckler herds continue to contract. At the same time, cow slaughterings are predicted to drop off slightly from their post-BSE peak of some 560,000 head in 2008 due to the decline in eligible animals remaining on-farm. Some recovery in average carcase weights is expected from lows of the past year as a result of better 2009 grass-growing conditions and lower feed costs. Even so, overall UK beef and veal supplies are expected to fall back to around the 850,000 tonne level of 2006.

Although domestic beef consumption seems certain to be negatively affected by the recession, a continued growth in mince sales is forecast to help offset declining demand for steak and roasting joints. As a result, annual consumption in the coming year is only forecast to fall back to 2005 levels, staying comfortably above the one million tonne mark.

With no prospect of Brazilian beef returning to the European market in any significant quantity for at least the first half of the year, imports are thought likely to remain at a similar level to last year and, most importantly, in a mix that exerts altogether less downward pressure on the market than in the past.

Also leaving EBLEX cautiously optimistic for the year ahead is the likelihood that the continued weakness of sterling against the euro will enable UK exports to grow still further in 2009, with plenty of headroom remaining available before they reach anywhere near pre-BSE levels of over 270,000 tonnes per year.

UK Beef Market Figures (tonnes)

  2006 2007 2008 (est) 2009 (forecast)
Production 847,000 882,000 863,000 848,000
Imports 295,000 301,000 303,000 300,000
Exports 46,000 67,000 85,000 90,000
Consumption 1,094,000 1,115,000 1,080,000 1,058,000

The recent bad weather postponing of the annual EBLEX/BPEX Outlook Conference will allow these forecasts to be extended through to 2010 at the re-scheduled spring event.

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