Mixed outlook for beef producers

Beef producers face mixed prospects over the next 12 months and beyond, warns EBLEX.

Supplies of UK beef this year will be 5% higher than in 2009, while beef and beef product imports will be roughly the same as last year and a stronger pound will make export growth difficult.

While dairy cow numbers are falling, the beef herd is stabilising. A big rise in dairy bull rearing will more than offset the effect of lower heifer disposals from beef herds, with total slaughterings this year expected to rise by nearly 3% on 2009.

Carcass weights have been higher so far this year but are expected to fall back for the rest of the year, while cow and adult bull slaughterings will continue to increase.

However, the continued reduction in the national beef breeding herd will bring the national kill down by 2% in 2011. As a result UK beef production is also expected to fall back sharply in 2011 to around 860,000t, against 896,000t this year.

EBLEX therefore expects imports to rise again next year, although not to 2008 levels. Export growth should also compensate for any slowing in domestic demand, and lead to overall supplies reducing again.

“The mixed beef outlook is further complicated by the year-on-year increase in calf registrations recorded in 2010 which seems likely to result in domestic supplies growing again from 2012 and reapplying the downward pressure on producer prices,” says EBLEX in its latest Beef Briefing.