August 22, 2006

Market rewards UK beef producers who wait out slump in demand

UK's National Beef Association has heaped praises on its ranchers for retaining finished cattle from the market to allow the recent glut of cattle to be cleared.

A recent glut in cattle supply had resulted from some farmers eager to offload their cattle as recent

high temperatures led to higher costs and rising mortalities.

Thanks to finishers who held back, slaughter cattle prices are improving once again, eradicating the threat of premature price falls into autumn, the NBA said.

Favourable weather has restored demand after the price drops experienced in the second half of July and early August, said NBA chairman Duff Burrell.

However, weather alone would not have been enough to cause the price increases seen over the past two weeks, said Burrel. Rather, it is the nationwide effort to balance slaughter cattle supplies with reduced demand that helped stabilise the market, proving that finishers are now more responsive to market signals, he added.

Feeders have learned it is futile to send cattle to an over-supplied market, said Burrell.

Last week the Livestock and Meat Commission in Northern Ireland reported a 14 percent drop in the number of cattle and prices there began to lift as stocks dwindled, a phenomenon that is repeated across the country. 

One result is that deadweight averages have defied expectations and are now 10-11 percent higher than they were at this time last year and rising.

Burrel said that with the benefit of experience, farmers would be even quicker to respond with the next heatwave as they have now learnt to hold back cattle supplies until stocks clear and processors come knocking.