Sep 2016 Market Overview

Beef

UK – UK cattle trade continued to march upwards throughout August as supply has tightened further. Mid August dead weight prices crept above the 5 year average for the first time this year and have almost recovered to the levels of the same time last year. Prices have strengthened 10p/kg over the past three weeks and over 35p since the low point in the year. It is now demonstrating a positive year-on-year uplift for the first time since October last year.


Although Heifer and Young Bull slaughter numbers YTD show an increase of 1.2% and 11.4% respectively (Steers slaughter numbers are stand on) there has been a dramatic decrease in Julys kill numbers (19k head) compared to that of the same period of last year (a reduction of 10%). So as we continue through the busy summer months the uncertainties of an unpredictable market continue to impact drive prices upward.

North America – The USDA have recently increased its forecast for beef imports the second half of 2016 and first half of 2017 reflecting the recent lifts on the restrictions imposed on Brazil and the UK. Increases in imported beef into the U.S is set to exceed 7,000 tonnes (40% increase).

South America – July and August export number fell below that of the same periods last year for the first time (estimated Aug figures circa 87k tonnes). Despite this drop, Brazil still remains the main exporter of beef and poultry into Europe (currently providing 45% of beef the EU imports). The main reason for this being competitive prices. High slaughter numbers in Uruguay have meant supply is strong therefore
keeping prices well below the levels seen in 2014 and 2015 (3.05 US$/kg). Meanwhile prices in Argentina and Paraguay have stayed level throughout Aug.


Lamb

Live weight lamb prices began to decline as we approached the back end of August as higher numbers have been coming to the market.
In the week ended 17 August, the price of lambs at GB auction markets declined compared to the previous week. Deadweight prices dropped by 3p on the week at 186.4p/kg, however, sharper falls seen at this time last year meant that the gap between this year’s and last year’s prices grew, with 2016 prices being 41p higher than those from 2015.


Pork & Bacon

UK Pig slaughter numbers have risen slightly which will ease the pressure on availability (or lack thereof).  This increase in slaughter numbers may well be a direct result of producers taking advantage of higher prices. However, the market still remains very difficult to predict as the kill numbers remain low both in the UK and on the continent with no sign of improvement in the near future. The EU prices continued to rise taking it above last year’s levels. Tightening supply, strong export demand and rising EU prices are all contributing to the support the UK price is currently receiving. Combined with this, the falling value of sterling against the euro is continuing to increase the attractiveness of domestic pork over its European counterparts

Poultry

The total number of tonnes of UK poultry meat produced last month was down by 1.6% to 143.5k tonnes. However, 2016 is showing some of the highest number in terms of number birds slaughtered in the last 5 years As predicted prices coming out of the EU have stayed firm with producers quoting stand on for September. This is despite of even further weakening of the sterling.

Download the Sep 2016 Report as a PDF file