April 3, 2020

 

Consumer demand put pressure on EU cattle prices

 

 

In the past four months, deadweight cattle prices across Europe have largely been increasing and returning towards more long term averages.

 

However, in the most recent weeks (up to 21 Mar) prices have stabilised in euro terms.

 

UK cattle prices have also been firm, although only as a result of weakening sterling. In euro terms, UK cattle prices have fallen by EUR0.23 per kg in three weeks.

 

Reflecting the weakening sterling, both EU and Irish cattle prices have recorded increases in price over the last few weeks, when converted in sterling terms. EU up GBP0.23 per kg and Irish prices up GBP0.24 per kg over the last three weeks. It is a similar story for cow prices.

 

Industry reports from Ireland suggest prices are currently under downward pressure. Ireland exports a large proportion of its beef production, with around a third of those exports destined for the foodservice market. Foodservice across Europe has been closed due to COVID-19, impacting on demand. The move out of foodservice and some consumers suffering a loss of income is also pushing demand to shift from high value cuts towards mince and lower value cuts.

 

Ireland is receiving some pick-up in export demand from China resumed economic activity post-COVID-19, which should help to offset some of the lost European sales.

 

Beef exports from Ireland to the rest of Europe are expected to continue, although perhaps at a lower volume and with mince and lower value cuts making up the majority. This will be impacting on overall carcase values and be having a knock on effect on farmgate prices.