January 27, 2006

UK to release over 30-month-old cattle into market
 

The UK will be allowing cattle over 30 months of age into the market for the first time in 10 years following a decision made in Nov 2005.

28 plants have been approved to process cattle aged over thirty months with more expected in the coming months.

Cows over 30 months old have been previously disposed of through the Over Thirty Month Scheme (OTMS) instead of entering the market.  OTMS is a market support measure serving as an outlet for cattle that could not be sold in the market due to the 30-month-rule imposed. Older cattle are suspected to be more susceptible to mad cow disease and were therefore not allowed into the market under British rules imposed 10 years ago. Changes to legislation and tighter monitoring now allow such cattle to enter the market, a move which may result in a significant increase in UK beef, said beef economist Duncan Sinclair at British Cattle Conference 2006. 

Beef prices may not be affected much if major retailers accept such products for use in retail or processed products such as beef burgers, Sinclair said. As exporters expect such a move to put downward pressure on beef prices, most of the poorest quality cows have already been disposed by the OTMS.

Sinclair suggested that producers seek professional advice on the types of beef to be sold into the food chain as the market place adjusts. He also advises producers to take note of EU hygiene rules introduced from Jan 1, 2006. Prime cattle producers can reduce their risk by limiting the number of cattle they market in the next few weeks as the extra beef available may depress prices, he said.

The deficit in the EU beef market presents a great opportunity for UK exporters, said Sinclair. UK producers are expected to benefit greatly from the rule change since cattle will be sold at market prices instead of a flat rate compensation price under OTMS.