Press Release - Omens good and more breeding cattle needed

NATIONAL BEEF ASSOCIATION
 (Press statement – No embargo)

November 3rd 2008

Omens good and more breeding cattle needed.

The United Kingdom will produce less beef both this year and next, it will export more, it will import less – and the most recent retail survey shows that consumers are spending eight per cent more money than they did a year ago on beef to cook at home.

Which means, says the National Beef Association that lower domestic supply levels, and the continued strength of household retail trading, carry the promise of significant future price rises for slaughter cattle and beef producers should feel confident about the long term outlook for their businesses.

 “This comforting information is taken from regular, and accurate, updates provided by AHBD Meat Services and the Livestock and Meat Commission but the same reports also show a worrying increase in breeding cow disposals, “explained NBA director, Kim Haywood.

“British abattoirs have confirmed that between January and August cow throughput increased by 20 per cent compared with the same period last year and an additional 7,450 cows, many of them sucklers capable of breeding more calves, were killed.”

“The Association is aware that many beef farmers are under short term cash pressure that is not being helped by the unexpected easing of slaughter cattle prices over the last three weeks. However we would nevertheless urge them to take a long term view and recognise that this autumn could be a good time to hold on to breeding stock because important market trends are moving firmly in their favour.”

Similar culling activity in the past is the reason for a four per cent reduction in prime cattle throughput in English and Welsh abattoirs between January and the end of September, an eight per cent fall in Scotland and a 12 per cent plunge in Northern Ireland.

“The supply shortfall created by culling in 2005-2006 is the main reason prime cattle prices soared this year and the NBA would like all the UK’s beef farmers to think about what would happen if more cows are culled out in future. Total production, including cow beef, is already expected to fall by a further two per cent next year too,” said Ms Haywood.

“It is important to realise that domestic beef supplies are also being trimmed by export sales which so far this year have risen by 12 per cent, or 4,928 tonnes to total 46,000 tonnes while a further six per cent rise is expected next year too.”

”At the same time imports over 2008 are expected to fall by 2,000 tonnes, or about one per cent, which is important because if more spare beef was available at world level more countries would have been competing to bring more in.”

“And equally importantly retail surveys conducted over the three months to October 6th show that even though total sales were down by six per cent compared with the same period last year, and more consumers turned to mince and stewing beef, the cash total spent on fresh beef to cook at home rose by eight per cent to £374.4 million.”

“In these circumstances it reasonable to think that too many breeding cows have already been taken out of the system and that every female that can produce a calf that will be processed in 2010-2011 will be needed,” Ms Haywood added.

For more information contact:

Kim Haywood, NBA director.  Tel. 0131 336 1754