Prime cattle markets drop back once again

Wednesday, 30 September 2020

By Felicity Rusk

Prime cattle markets have continued to move down in the most recent week. In the week ending 26 September, the GB all prime average stood at 367.0p/kg, 1.0p less than in the previous week. This puts prices 13.5p above the same week in the previous year, and just over 44p above the five-year average.

Price drops were recorded in all key prime markets, although the largest drop was recorded in steers meeting the R4L specification.

  • Steers (overall): 367.8p/kg, ↓ -1.0p
  • Steers (R4L): 380.5p/kg, ↓ -2.8p
  • Heifers (overall): 367.8p/kg, ↓ -1.1p
  • Young bulls (overall): 355.3p/kg, ↓ -0.6p

Estimated slaughter increased by 1.6% on the week, the equivalent of 530 head to total 33,750 head. Interestingly heifer throughputs increased by almost 10% on the week . However, both throughputs of steers and young bulls dropped back on the week.

Cow markets meanwhile remained comparatively more steady. Overall cow prices remained steady on the week, at 244.7p/kg. Meanwhile, prices for cows meeting the O4L specification increased by 1.1p on the week to reach 263.8p/kg. Throughputs dropped back by 200 head on the week to total 11,700 head.

The latest data from Kantar continues to show strong retail growth for the beef market, with growth tracking in-line with the average food and drink uplift. In the 12 weeks ending 6 September, volume sales of primary beef were up 10.6% compared to the same period in the previous year. This is marginally above the growth for the total food and drink (excl alcohol) category as a whole, at 10.3%. The roasting, stewing and steak categories continued to record particularly strong growth, however the growth was more muted in mince sales.

While volumes remain well above last year, the volume growth has dropped back from the previous period. In the 12 weeks ending 9 August, volume sales of primary beef were up 15.5% on the year. This is not surprising as more of the foodservice and hospitality sector comes back online, sales at retail will inevitably decline.

However, tighter local restrictions have the potential to disrupt regional demand, affecting carcase balance. Furthermore, there are some localised cases of consumers returning to ‘panic buying’ behaviour. As such, it will be interesting to see how demand develops in the coming weeks, and what impact that will have on overall beef demand.

Felicity Rusk

Analyst - Livestock

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