February 19, 2021
 

Ireland's cattle slaughter reaches 1.9 million heads in 2020

 

Ireland's Central Statistics Office data has recorded 1.9 million cattle heads slaughtered in 2020, including cows and calves that totaled 633,400 tonnes of Irish beef production - a 2% increase from 2019.

 

Much of the overall annual rise in slaughter occurred in the third quarter. Throughputs traced back from 2019 before a decline in the second quarter last year as COVID-19 disrupted abattoir operations and export opportunities.  However, it should be noted that during Q3 in 2019, the slaughter was significantly lower due to protests at abattoirs.

 

Throughputs during Q3 2020 were relatively unchanged compared to Q3 2018. This seems to be the case for the year overall. In fact, overall slaughter last year was 0.7% lower than it was in 2018.

 

For 2020, heifer and steer slaughter were 3% and 10% higher year-on-year, respectively. Slaughter of bulls, including adult bulls, fell by 29% year-on-year. Reports suggest this is partly due to a shift by abattoirs away from young bull beef. Many bull finishers also reportedly faced delays in getting their animals slaughtered in 2019, and so have moved to produce animals as steers. This partly explains the rise in steer throughputs. Cow slaughter also rose by 6%, having been notably lower in 2019.

 

As COVID-19 disrupted eating-out markets across Europe, the quantity of fresh, frozen and offal beef exported globally during the first 11 months of 2020 fell by 3% on the year. 466,700 tonnes were exported at a total value of €2.1 billion (US$2,533,524,000), a marginally weaker average unit price.

 

During the period, shipments to the United Kingdom fell by 1% year-on-year to 208,800 tonnes, the lowest volume since 2013. Growth in volumes during the second half of the year largely outweighed losses in the first half. The total value of these shipments rose by 2% year-on-year to €920.2 million (US$1,110,166,088).

 

Exports to the 27 member countries of the European Union fell to 178,600 tonnes, an 8% decline for all major trading partners apart from the Netherlands, volumes of which remained unchanged year-on-year.

 

Trade to non-EU countries was more diverse as shipments to the Philippines, Ireland's key non-EU destination for beef, experienced a decline by 5% year-on-year. However, notable year-on-year growth was seen in exports to Japan, the United States and Canada,.

 

Irish cattle prices, like many other countries in Europe, generally strengthened throughout 2020. Cattle prices took a plunge during the month of April and May caused by COVID-19 lockdowns and disruption but recovered in the second half of the year.

 

The deadweight price for an Irish R3 grade steer fell to a low of €3.40/kg (US$4.10) in mid-April, before gaining €0.35 (US$0.42), and peaked at €3.75/kg (US$4.52) in mid-August. Prices were supported towards the end of the year by some reopening of UK foodservice followed by Christmas buying and stockpiling before the Brexit deadline.

 

Despite the growth in Irish prices, the rise in Great Britain prices has been even more marked during 2020. Prices dropped to €3.71/kg (US$4.48) in mid-April, before rising by €0.55 (US$0.66), and peaked at €4.26/kg (US$5.14) by the end of November. Prices continued to strengthen into 2021. In the week ending 30 January, the equivalent GB deadweight R3 steer price was €4.30/kg (US$5.19), €0.48 (US$0.58) above the Irish price for the same week. As GB prices become more expensive relative to Irish prices, Irish beef price became more competitive.

 

According to the Irish food board Bord Bia, the Irish cattle supply looked tight for the first half of 2021, following higher-than-expected cattle slaughter from the second half of 2020.

 

It is anticipated that there will be 50,000 fewer finished cattle available to slaughter which could lead to a year-on-year fall in the slaughter of around 3%. Compared to the same month in 2020, January 2021 processed 4.3% fewer cattle. Tighter supplies may offer support to Irish cattle prices. However, export demand will be key.

 

The main influences on the demand for Irish beef will be how foodservice markets recover in the UK and how much disruptions will the new EU-UK trading relationship cause.

 

Trade point of view forecast that UK beef imports will show some recovery in 2021 due to expected lower domestic production and partial reopening of the foodservice sector in the second half of the year.

 

Irish exports to the UK are also expected to remain high although added costs may make shipments more expensive.

 

As the recovery from COVID-19 is slow, Bord Bia expected that the demand for beef in EU will remain weak. Lower prices of pork may also put pressure on beef consumption in some markets.

 

 - AHDB