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Reduced supply and steady demand for beef is driving up prices at the farm gate.
A recent smaller kill and continued consumer demand has resulted in the beef sector looking positive this summer. Average prices are up 50p/kg on last year putting £200 onto a 400kg R grade steer.
The price spike has been put down to the falling kill numbers which were back 4.5% year-on-year in May. Supply has also been reduce through lighter carcases coming to slaughter, steers were down by 2.5%, heifers 0.5% and bulls 1%.
The fall in steer weight amounts to 10kg less per carcase. For an abattoir killing 1,000 clean cattle a week, (50% steers, 40% heifers and 10% bulls), they need an extra 17 cattle to maintain beef throughput at present.
Domestic demand is holding up with Kantar Worldpanel reporting strong household beef purchases throughout the spring.
Evidence shows sales up by around 3.5% year-on-year. Sales of steaks were particularly strong, underpinning the overall increase. There has also been a spike in manufactured beef products, such as burgers, beef-based ready meals and steak pies.
All of this paints a positive picture for beef farmers this summer which is flowing through into the store trade season.
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