Farmgate prices remain firm despite tightening of UK beef supply
According to the latest market commentary by Quality Meat Scotland (QMS), farmgate prices for prime cattle are around 8.5% higher than a year ago and up 3% from the recent low point at the start of June.
Data recorded by market analysts Urner Barry showed rising prices over the past couple of months for beef cuts that are “most attractive to restaurants”, for example striploins, fillets and rib roasts. Lower valued cuts suitable for mincing and dicing have seen little movement in wholesale price over the past quarter, with retail prices showing similar patterns. Mince and diced products retailed at a lower price than 12 months ago, but roasts and sirloin steaks saw an increase in price.
QMS found that the rise in prices in the wholesale and retail markets do not match the level of increase in farmgate prices over the past 12 months.
The public body explained that the relaxation of Covid-19 restrictions has begun to impact the wholesale market for beef and, hence, the value of a broken-down beef carcase to the abattoir operator or butcher.
According to QMS, a reduced number of cattle available and disruptions caused by processing staff self-isolating because of Covid-19 control measures has led to reduced slaughter numbers during June. This, combined with a slight fall in carcase weights, resulted in domestic beef production during May and June in the UK falling more than 3% compared to a year earlier.
“A strong recovery”
Stuart Ashworth, chief economist for QMS, explained that domestic supplies were also influenced by the balance of international trade. Ashworth said: “Trade data available to the end of May shows UK exports of beef have recovered strongly from a low point in January, and, during April and May, accounted for some 12.5% of UK ex-abattoir beef volume.”
During May, exports were only 4% lower than a year ago compared to the 40% decline in exports seen over the first quarter of 2021. Beef imports during April and May are reported by QMS to be little changed from the same period last year and make up around 20% of the beef available on the home market.
QMS reported that there is now greater emphasis on frozen beef imports, which increased more than 60% on the year over April and May. In contrast fresh and chilled imports during April and May are down 25%, compared to data from a year ago.
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