Finished cattle prices rise amid tight supply

Tight supplies of cattle both in the domestic market and Europe are supporting beef prices.

Prime cattle averaged 240.6p/kg at GB auction markets, up 1.8p on the previous week.

Steers were up 0.1p to average 237.7p/kg, while heifers averaged 249.6p/kg, up 2.9p.

Young bull prices rose 2.1p to average 226.9p/kg. GB deadweight prices are also increasing, with both steers and heifers averaging about 420p/kg.

See also: How a Simmental herd made £79 a cow before subsidy

Industry reports suggest prices are being driven by demand from processors looking to export, while high prices may be beginning to curb some domestic retail demand.

At Ludlow Market on Monday 28 March, heifers averaged 248p/kg and steers 231p/kg. Auctioneer Michael Thomas said good, thick-meated heifers were highly sought after. For steers, buyers were keen to compete for numbers, with well-fleshed, heavier cattle  most in demand.

Supply

For the year to date, GB prime cattle slaughter is down 9% on 2021 levels, and cow slaughter is 5% lower on the year, according to AHDB figures. Short numbers of cattle in Europe should also help alleviate some market pressure from Irish beef imports.

Mark Zieg, beef sector manager at Bord Bia, the Irish Food Board, said supplies are tight in northern European markets such as Germany, Poland and the Netherlands, and European beef supplies are forecast to remain tight, down 1.4% for the year.

Mr Zeig said: “Consumer demand will be kept in check by price inflation – in Britain there is an expectation of further retail sales decline in 2022 as price increases become evident, while the food-service channel is expected to recover as the year progresses.”

Retailer demand

Morrisons is looking to recruit new beef finishers as part of its dairy beef scheme.

The scheme works with about 80 beef finishers to rear and process more than 12,000 cattle a year, with the supermarket chain looking to increase numbers.

Finishing units are typically rearing either continentals or reared calves from Holstein/Friesians in batches on contract for the supermarket chain.

The average weight for finished cattle in the scheme is about 340kg deadweight and can range from 280kg to 400kg. Cattle are processed at Woodheads abattoirs, a subsidiary of Morrisons.

Since 2013, more than 50,000 calves have been reared on-farm throughout the UK for Morrisons, in partnership with the Buitelaar Group.

Morrisons livestock buyer Jessica Tomley said: “We are actively looking for new finishers to join the scheme, and this is a great opportunity for new producers to be involved with a progressive retailer-led initiative.

“We work closely with our finishers to ensure the correct cattle are delivered to farms in order for the cattle to hit the ground running and not look back – a good working relationship and communication between producer and processor is vital when it comes to this type of system.”

Futures markets and commodity risk management online course:

  • Risk management strategies for a more predictable financial performance
  • Educated conversations when collaborating with your advisors
  • Negotiate better prices with your grain merchants

View course