March 26, 2009

The ongoing economic woes have pushed an increasing number of UK consumers away from beef but towards the cheaper pork and poultry.

Household purchases of fresh and frozen beef in the 12 weeks to February 22 decreased 4.2 percent on-year to 75,659 tonnes, according to figures released by the Agriculture and Horticulture Development Board.

Most beef cuts recorded a significant decline, but the largest fall was in first and second quality roasts, sales of which plunged 42.6 percent. Only cheap stewing beef and mince increased 7 percent and 3 percent, respectively.

Average retail prices of beef has increased 16 percent last year, driving up total household sales by 11 percent to GBP457 million (US$667 million).

Figures showed that regional beef sales have all decreased except for London which grew 0.7 percent during the period. Scotland recorded the largest beef sales drop of 6.6 percent, followed by Wales and the west at 6.3 percent, and the Midlands at 5.4 percent.

The figures also showed that sales of leg roasting joints increased 16 percent on-year, while poultry volumes increased 3.2 percent to 143,589 tonnes. Expenditure moved up 9.9 percent to GBP580.2 million (US$846.1 million).

The sluggish beef demand has put ex-farm cattle prices under pressure, and deadweight cattle rates have been falling in the last month. The GB steer average dropped 2 percent to 281.4p per kg in the week ended March 14, while GB heifer average fell 3 percent to 279.1p per kg.

National Beef Association director Kim Haywood called on cattle finishers and feeders to resist further cuts and to ask retailers to increase retail prices so more favourable returns can flow to processors and farmers.