World beef production declined slightly in 2009, led by a contraction in EU and US breeding herds.
Beef and veal output fell by 2% on average in major producing countries in 2009 – and this year could see greater declines, according to industry body EBLEX.
The organisation’s latest bi-annual International Meat Market Review shows all major beef producing countries saw similar reductions in production levels, with the exception of Argentina.
Key producing countries such as the USA reduced the size of their breeding herds leading to high cow cullings. But due to a decline in prime cattle slaughterings this had contributed to an overall decline.
In Brazil, there are signs that the downturn in beef production is coming to an end and a small recovery is forecast in 2010. Exports of beef from Brazil are expected to rise for the first time since 2007.
But poorer export trade accounted for a decline in Australian beef production, not helped by a sharp increase in the value of the Australian dollar.
But in Argentina, the effects of government policies to control beef prices, coupled with two years of drought, had led to increased production as herds were culled. This is expected to result in severe shortages of cattle available for slaughter in 2010 (down about 21%) with low calving rates in 2008 and 2009 making the situation worse.
“The global economic downturn is continuing to result in weaker demand for beef, especially in developed economies, with the food service sector especially affected,” said Joanne Knowles, red meat market intelligence manager for AHDB.
“Consumers are cutting down on their discretionary spending while household purchases are holding up somewhat better. They are trading down to cheaper cuts, so weakening the hindquarter market in particular, and also looking for cheaper sources of protein. This fall in demand has reduced cattle prices but intensive producers have benefited from lower global cereal prices.
“World trade in beef has also fallen with demand from Russia and Mexico showing a decline.
“Looking ahead, we expect overall global demand for beef and veal to show a modest upturn in 2010, mainly down to growth in Asian markets.”
The June 2010 issue of International Meat Market Review is produced by AHDB Market Intelligence. Visit www.ahdb.org.uk• code123