Beef supply fears rise

Fears are growing over the UK’s beef supply as the industry issued a double warning about supplies tightening later this year and the rising crippling cost of production.

Concerns were raised last week as the National Farmers’ Union (NFU) cautioned that farmers received on average just 48% of the final retail price of their beef. The sector was hit by an oversupply in 2010 — coupled with a massive hike in feed prices, as well as energy and fertiliser costs — which means that most are predicting stock problems in the latter half
of 2011.

Now, apprehension is growing that the industry crisis could soon mirror that of the problems seen in pork. Alistair Mackintosh, the NFU livestock board chairman, told Meat Trades Journal, the industry should come together and avoid “short- termism”.

He said: “We need to see an increase in the farmgate price before the situation becomes unsustainable.

“We [farmers] have been told to look at our costs and we are always doing that — but some we are facing at the moment are frightening. We are faced by the cost of fertiliser doubling, feed prices have increased by 40-60%, fuel prices are soaring, and labour is always a concern.”

In a similar situation to the pork market, Mackintosh said the big supermarket retailers were scared of putting up the cost of beef on their shelves. “No one supermarket will increase their prices, but within the food chain there are margins that can be more fairly distributed.”

The concerns come as Eblex, the levy body, revealed that the national beef and dairy cow numbers have stabilised for the first time in more than a decade. Its research showed a year-on-year decline of less than 0.5% in the UK dairy herd alongside an increase of nearly 3% in beef breeding cow numbers. It said that, on this basis, the overall national cattle breeding herd is expected to stabilise at just over 1.9 million head in 2011 — or some 80% of its level at the start of the century.

Eblex senior economic analyst Mark Topliff said: “Eblex, however, forecasts that prime cattle slaughterings will continue falling over the coming year. This is mainly due to reduced pure-bred dairy bull calf registrations as a result of declining intensive rearing demand in the face of the high cereal and bedding prices seen this winter and expected to continue through 2011.”