Prime cattle prices are expected to strengthen in 2009 and beef producers should have the confidence to stay in the industry, the National Beef Association has urged.
It is worried that after several difficult years, many breeders will see the current high cull cow values as a chance to sell up. But the long-term signals for the sector were good and should inspire more confidence, NBA director Kim Haywood said.
Retail beef prices were at least 20% more than this time last year and tight prime cattle supplies meant average UK deadweight prices could soon hit 300p/kg and the average unproductive cow significantly above 200p/kg, she predicted.
“In these circumstances it is important for even the weariest of the UK’s embattled beef farmers to take a cool look at their future prospects and see these important market improvements as a clear sign that much smoother economic waters lie ahead, instead of regarding them as a green light to quit beef farming altogether.”
A 20% decline in the strength of sterling against the euro would have particular importance in improving UK export prospects this year and reducing Irish import competition, which in turn would improve slaughter prices, the NBA said.
“And on top of this, a 15-18% drop in domestic production has been forecast for this coming autumn as a result of the dramatic drop in beef-cross calf numbers coming out of the dairy herd following the huge swing to Holstein inseminations in September 2006,” Ms Haywood added.