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No Significant Increase Forecast in Prime Cattle Supplies

02 August 2013

UK - UK cattle supplies are expected to remain tight as a direct result of the decline in the breeding herd and this will impact on beef and veal production levels in 2013 and 2014, according to the latest forecasts from AHDB/EBLEX.

Calf registrations in the first five months of 2013 were significantly back on the year, with non-dairy calf registrations over 70,000 head lower due to producers’ concerns about high production costs against the backdrop of an uncertain economic outlook. The consequence of this will undoubtedly be a reduction in the production of quality beef and, even if producers begin to rebuild herds now, any turnaround in production is unlikely before 2016.

For 2013 as a whole, the forecast for production from prime cattle to be lower is little changed from earlier positions. The slight uplift in throughputs will be more than offset by lower finished weights, as a result of the poor seasonal conditions. Production of beef from cows and adult bulls is also forecast to be behind last year, as lower weights are expected to compound lower throughputs. Looking ahead to 2014, a return to more normal finished weights is likely to offset the reduced throughputs to some extent and therefore production is forecast to be little changed on this year’s level.

Exports this year and next will largely be influenced by available supply. In volume terms, 2013 is forecast to be similar to last year and will amount to a broadly unchanged percentage share of production. Firm demand for manufacturing beef in the wake of the horse meat issue is likely to continue to support export prospects, as consumers on the Continent continue to trade down to cuts such as mince and burgers.

Imports in 2013 are expected to be down on the year, largely due to subdued demand for processed product on the home market following the horse meat revelations. Some slight recovery is expected next year as both fresh/frozen and processed imports are expected to be higher. The upturn in production in Ireland also suggests scope for increased trade with the UK for this year and next.

With no increase in production and a broadly level trade position, supplies available for domestic consumption will be modestly lower in 2013 than in the previous year. Only a small increase in available supply is expected in 2014, largely on the back of an increase in imports. With strong consumer confidence in British beef and support for native bred cattle strengthening, the outlook for returns to producers is robust. However, a shift towards expanding the herd ultimately depends on the prospect of positive farmgate margins, which will encourage producers to invest in their businesses.

Actual and forecast supplies of beef and veal in the UK (‘000 tonnes)

  2012 2013 2014
Production 882 870 870
Imports (a) 409 385 400
Exports (a) 143 145 145
Consumption 1,148 1,110 1,125

(a) Carcase weight equivalent and including processed product.

All figures subject to revision. Forecasts in bold. Totals may not sum due to rounding

Source: Defra, AHDB/EBLEX

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