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AHDB Cattle and Sheep Weekly


28 October 2014

EBLEX Cattle and Sheep Weekly 28 October 2014EBLEX Cattle and Sheep Weekly 28 October 2014


Sheep Weekly

 Some Signs of Stability in the Lamb Trade

For another week the lamb trade has demonstrated some signs of stability, with the SQQ at GB auction markets in week ended 22 October tracking above the previous week. At 155.0p/kg, the weekly GB NSL SQQ edged up over 2p/kg on the week earlier. With somewhere in the region of 120,000 lambs penned nationally, this represented a drop of 6% on the previous week. This could be one of the key drivers behind the stability in the trade, amid reports suggesting that demand was a little subdued.

While the greatest week-on-week price change was on Wednesday 22 October, when the SQQ was up 4p/kg, the top price of the week was achieved on Monday 20 October when the SQQ reached 156.5p/kg on the back of a 14% fall in throughputs.

Lamb Slaughterings Remain Ahead of 2013 Levels

Further confirming the expectations of a larger lamb crop and better finishing conditions, the UK lamb kill for September was again ahead of year earlier levels, being 1% up on the year at 1.12 million head. Despite not showing the same year-on-year increase as at the start of the season, the uplift in September represented the sixth consecutive month in which throughputs were up on the year.

Consequently, in the June to September period, lamb slaughterings were up nearly 5%, or 191,000 head, on year earlier levels. With lower throughputs in the first quarter of the year, this means that in the year to date, lamb throughputs were up 2% on the year at 8.98 million head. Following last year’s elevated kill number, UK adult sheep slaughterings during 2014 have been lower year on year and throughputs in September were back 8% to 153,100 head. This takes the adult kill in 2014 so far to 1.35 million head, back 10% year on year. This year producers have not been dealing with inflated feed costs so, unlike in 2013, there has been less impetus to reduce breeding flocks sizes.

 On the back of more favourable weather conditions, lamb carcases were 2% higher in September, compared with the same month in 2013 at 19.2kg. Adult carcases were also heavier, albeit only by 1%, at 25.8kg. Overall sheep meat production was up 1% on the year at 25,400 tonnes, as the reduced adult sheep kill offset the higher carcase weights and more lambs were being slaughtered. Production in the year to date is now up 3%, or 6,000 tonnes, on the year.

Date for AHDB Outlook Conference 2015

The 2015 Outlook conference, jointly hosted by EBLEX, DairyCo and BPEX, will be held at One Great George Street, in London, on Wednesday 11 February 2015. The conference will look at future consumer trends and the impact on demand for dairy and meat products in changing Asian markets.

Cattle Weekly

In week ended 18 October, the cattle trade stabilised amid reports suggesting that the market for both commercial and cattle fitting specific supermarket schemes was finely balanced. Despite numbers seemingly increasing on the week, the all prime deadweight average levelled at 349.4p/kg.

 This broad stability continues to reflect a more positive trading environment in which the all prime average has strengthened by more than 20p/kg since the start of August. With throughputs over the period up around 15,000 head, this price rise has evidently come as demand has improved. This means the supply and demand balance has consistently been in producers’ favour, with processors looking to secure adequate supplies of cattle. The situation could be maintained as the peak seasonal buying period approaches. Higher cull cow marketings over the past couple of weeks have resulted in supplies running ahead of demand and consequently prices have eased. At 235.1p/kg in the latest week, the –O4L average has fallen 6p over the past fortnight. Numbers forward are likely to remain high in the short term as producers take stock of their herds ahead of winter housing.

Beef and Veal Production up Again in September

UK prime cattle slaughterings in September were up 1% on the year, to 151,300 head. With significant increases in all regions of the UK, steer slaughterings were up over 10% on the year to 79,400 head. This represented the highest September steer throughput since 2011. In contrast, heifer numbers tracked below year earlier levels, being back 2% at 53,600 head.

 

 The overall increase in slaughterings is consistent with the recent UK cattle population report from Defra, which showed more cattle over two years of age on the ground in June. Young bull throughputs were back almost a quarter on the year at 18,300 head. The penalties for bulls not meeting supermarket specification will have discouraged many producers from this type of production, especially when cereal costs were higher last year. Adult cattle throughputs were back 5% on the year to 46,100 head.

The better conditions have once again had a positive influence on carcase weights for all types of cattle and consequently on production levels. With the higher steer numbers, UK beef and veal production from prime cattle for the month was up 3%, or 1,500 tonnes, on the year to 52,400 tonnes. At 15,000 tonnes, production from adult cattle was back just 3% year on year, as the higher weights mitigated lower throughputs. As a result, total beef and veal production was up 2% on the year at 67,900 tonnes. This takes year to date production to 582,000 tonnes, up almost 4% on the first nine months of 2013.

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