Beef Should Firm – But Don’t Expect it to Match Dairy

UK - THE increases will come more slowly than those which the dairy industry welcomed during 2007 – but beef values should rise.
calendar icon 28 December 2007
clock icon 2 minute read
That is the prediction of ABP managing director Richard Cracknell.

The increases will be driven by world demand underpinned, not least, by increased meat consumption in the massive populations of China and India.

As a long standing exponent of the laws of supply and demand, Mr Cracknell said companies like his own that were actively seeking to kill more cattle, would need to ‘pay the price’ in order to get those cattle.

As ABP strived to reduce its reliance on commodity beef and target higher value sales – as is already the case at the Ellesmere plant and its Sainsbury’s supply contract – so its demand for higher spec cattle would increase.

But Mr Cracknell, whose company handles towards one fifth of the national beef kill, admitted that current mainstream prices were probably insufficient to maintain current production levels of, particularly, suckler-bred cattle.

There could also be a swing to more extensive finishing systems as beef farmers began to look more closely at their costs of production.

With exports underway again, Mr Cracknell was also optimistic about prospects for cow beef for which his company was now back up to circa 145p for R grade cows.

Nationally, however, there is still some room for a lift in cow values with MLC quoting an average 120p for O4L and senior economist Mark Topliff said we were approximately two thirds way back to pre-foot-and-mouth export volumes of around 6,000 tonnes per month, when the average price was closer to 135-140p for Os.

Source: Farmers Guardian
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