2015-08-19   facebooktwitterrss

Tight Prime Cattle Supplies Continue to Impact on Production

UK beef and veal production is set to fall by two per cent to 860,000 tonnes in 2015, according to the latest AHDB Beef & Lamb market outlook.

Prime cattle supplies are expected to be tight for the rest of the year, but challenges in the dairy sector could lead to increased cow slaughterings.

Actual and forecast supplies of beef and veal in the UK (‘000 tonnes)

Actual and forecast supplies of beef and veal in the UK (‘000 tonnes)

All production figures in the table are for standard 52-week years. Consumption figures include processed product. Totals may not sum due to rounding.

The beef suckler herd is now at its lowest level since the late 1980s, at 1.57 million head, having fallen by more than 200,000 head in the past decade. In contrast, the UK’s dairy herd was up four per cent in December 2014 at 1.88 million head. However, the significant financial pressure being experienced by dairy producers may lead to a reversal in this trend.

British Cattle Movement Service (BCMS) data recorded significantly fewer cattle on the ground between 18 and 24 months of age at the start of 2015 than in the previous year, which has led to a drop off in prime cattle availability in 2015. While figures to June show that numbers overall are back only three per cent on 2014, this hides some notable variances in the trade.

In contrast, BCMS data in April showed that the number of younger cattle on the ground was up on the year and therefore slaughterings in 2016 are forecast to edge back up to around 1.97 million head, with production anticipated to reach 879,000 tonnes.

Carcase weights for prime cattle this year have generally stayed at the higher levels achieved in 2014, due to good availability of high-quality forage and lower feed prices. This trend is expected to continue for the remainder of this year and into 2016.

Exports are being influenced significantly by the strength of Sterling against the Euro, making it harder to compete on the Continent. UK beef and veal exports in the first five months of 2015 were down on the year earlier, despite only a small fall in production. Unless the Pound weakens, this looks likely to be the situation for the rest of 2015.

Import volumes this year are still forecast to be below the raised levels of 2014, but have been revised upwards given the Sterling/Euro relationship in the year to date. Despite production in Ireland being expected to be lower in the next six months, it is possible that any reduction in trade to the UK could be moderated, given the competitive position of Irish beef on the UK market.

AHDB

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