June Market Overview 2014

 


UK Beef

Pressure on prime cattle price continues

With no change in the dynamics of the market, prime cattle prices remained under pressure for another week. Sluggish demand, increased supplies and subsequent caution from processors continued to affect the average prices of all classes of prime cattle. Latest AHDB/EBLEX estimates suggest that in week ended 17 May, throughputs were up around 2,200 head on the previous holiday week. Consequently, the GB all prime deadweight average was back 5p to 337.8p/kg. The estimated number of steers forward increased by around 1,100 head, which contributed to the price of R4L steers falling another 5p on the week to 350.2p/kg. In addition, the number of heifers estimated to have been marketed increased around 500 head and, at 344.6p/kg, R4L heifers were back 4p week on week. Young bull numbers were estimated to be at their highest weekly level in the year so far. This, combined with the continued application of penalties for out of spec animals, resulted in the overall average price for young bulls falling 6p to 310.4p/kg.

UK Beef & Veal

As expected, improved conditions have meant that carcase weights for all types of cattle were once again heavier than in the corresponding month last year. Combined with the increased throughputs, this meant that UK beef and veal production in March was up 8% on the year, at 69,100 tonnes.

Global Overview

Brazil – Production & exports expected to grow though into 2015

Argentina – Supports Brazil on increased demand throughout World Cup

Uruguayan – Exports to Russia grow exporting over 910 tons of frozen beef

Australia – Beef & Veal Production up 18% YOY

China – Marked increase in meat consumption despite lower economic growth

EU – Prepares to reopen its market to Paraguayan Beef & increases pork quota to compensate Croatia's membership

Russia – Beef imports decline in first quarter

UK Lamb

Stronger prices across sheep trade

On Wednesday 21 May, the GB OSL SQQ was down 4p on the week at 204.9p/kg, while the GB NSL for the week was down 4p at 246.7p/kg. The seasonal pattern at this time of year is for the trade to generally ease on the back of increased supplies coming forward as the new season gets into gear. As such, unless numbers fail to materialise or demand is particularly strong, the expected pattern from here onwards is for easing of prices.

Seasonal switch over speeds up

The majority of lambs marketed are still old season, with only 46% of total lambs being new season. However, the coming weeks will see increased signs of switching over, with more new season lambs sold than old season. While there are still a surprising number of old season lambs coming forward, these numbers are now slowing and the trade is showing signs of easing as more processors look to switch to the new season.

UK imports still down year on year

UK imports of sheep meat in March continued to track below year earlier levels as China has continued to pull increased volumes of New Zealand sheep meat away from the European market.

EU imports lower too

Largely on the back of the decline in shipments to the UK, total imports of sheep meat into the European Union in the first quarter of the year were also lower. At 43,100 tonnes, total imports from external suppliers were down 11% on the year. As with the UK, this decline was driven by lower volumes from New Zealand, with shipments down 15%. Meanwhile, volumes from Australia were 36% higher as they looked to fill some the gap left by the lower volume of New Zealand product.

Pork

UK pig price

The EU-spec DAPP for the week ended 17 May rose marginally to 164.23p per kg. While the latest quote represents an upward trend, pig prices are now only very marginally above year earlier levels with an annual difference of 0.20p. The market appears to be well balanced, despite supplies remaining relatively tight; during the week, the estimated weekly kill totalled 150,600 head, around 6% down on a year earlier. For the week ended 17 May, the average carcase weight fell below 80kg for the second time since the turn of the year at 79.91kg; declining weights are normal during this time of the year and average weights remain nearly a kilo heavier than last year.

Highest UK pork exports in 15 years

Latest trade figures showed that UK pork exports in March were at their highest level since October 1998. The total was just shy of 18,200 tonnes, 13% up on the same month in 2013. In addition, exports to China/Hong Kong topped 5,000 tonnes for the first time ever (with shipments to China at a record 3,300 tonnes). The proportion of total pork exports shipped to the EU fell but volumes grew by 7% compared with March 2013. While supplies to Germany dropped by 8% on the year and shipments to Ireland were little changed, many other EU markets took significantly more UK pork than last March. Despite a higher requirement from China and Hong Kong, offal exports dropped by 30% on the year during March, to 4,000 tonnes, due to much lower exports to EU markets.

Pork imports also increased in March, up 7% compared with a year earlier to 29,500 tonnes. With the exception of Denmark, whose shipments came down by 16% on the year, trade with other key suppliers rose. There was also 4% more bacon imported during the month compared with March 2013. Demand for imported sausages also increased by 13% on the year, with higher supplies from across the continent, but other processed imports declined by 6% year on year.

Poultry

Chicken prices remain firm with poultry seen as a key BBQ commodity adding pressure for supply of thigh / wings / drumsticks and breast meat for kebabs.

One of the most versatile of proteins, poultry meat is easy to prepare and cook, low in fat and can lend itself to almost any flavour or coating.

Global Overview

  • Brazil – Production & exports expected to grow though into 2015
  • Argentina – Supports Brazil on increased demand throughout World Cup
  • Uruguayan – Exports to Russia grow exporting over 910 tons of frozen beef
  • Australia – Beef & Veal Production up 18% YOY
  • China – Marked increase in meat consumption despite lower economic growth
  • EU – Prepares to reopen its market to Paraguayan Beef & increases pork quota to compensate     Croatia’s membership
  • Russia – Beef imports decline in first quarter

UK Lamb

Stronger prices across sheep trade

On Wednesday 21 May, the GB OSL SQQ was down 4p on the week at 204.9p/kg, while the GB NSL for the week was down 4p at 246.7p/kg. The seasonal pattern at this time of year is for the trade to generally ease on the back of increased supplies coming forward as the new season gets into gear. As such, unless numbers fail to materialise or demand is particularly strong, the expected pattern from here onwards is for easing of prices.

Seasonal switch over speeds up

The majority of lambs marketed are still old season, with only 46% of total lambs being new season. However, the coming weeks will see increased signs of switching over, with more new season lambs sold than old season. While there are still a surprising number of old season lambs coming forward, these numbers are now slowing and the trade is showing signs of easing as more processors look to switch to the new season.

UK imports still down year on year

UK imports of sheep meat in March continued to track below year earlier levels as China has continued to pull increased volumes of New Zealand sheep meat away from the European market.

EU imports lower too

Largely on the back of the decline in shipments to the UK, total imports of sheep meat into the European Union in the first quarter of the year were also lower. At 43,100 tonnes, total imports from external suppliers were down 11% on the year. As with the UK, this decline was driven by lower volumes from New Zealand, with shipments down 15%. Meanwhile, volumes from Australia were 36% higher as they looked to fill some the gap left by the lower volume of New Zealand product.

Pork

UK pig price

The EU-spec DAPP for the week ended 17 May rose marginally to 164.23p per kg. While the latest quote represents an upward trend, pig prices are now only very marginally above year earlier levels with an annual difference of 0.20p.  The market appears to be well balanced, despite supplies remaining relatively tight; during the week, the estimated weekly kill totalled 150,600 head, around 6% down on a year earlier. For the week ended 17 May, the average carcase weight fell below 80kg for the second time since the turn of the year at 79.91kg; declining weights are normal during this time of the year and average weights remain nearly a kilo heavier than last year.

Highest UK pork exports in 15 years

Latest trade figures showed that UK pork exports in March were at their highest level since October 1998. The total was just shy of 18,200 tonnes, 13% up on the same month in 2013. In addition, exports to China/Hong Kong topped 5,000 tonnes for the first time ever (with shipments to China at a record 3,300 tonnes). The proportion of total pork exports shipped to the EU fell but volumes grew by 7% compared with March 2013. While supplies to Germany dropped by 8% on the year and shipments to Ireland were little changed, many other EU markets took significantly more UK pork than last March. Despite a higher requirement from China and Hong Kong, offal exports dropped by 30% on the year during March, to 4,000 tonnes, due to much lower exports to EU markets.

Pork imports also increased in March, up 7% compared with a year earlier to 29,500 tonnes. With the exception of Denmark, whose shipments came down by 16% on the year, trade with other key suppliers rose. There was also 4% more bacon imported during the month compared with March 2013. Demand for imported sausages also increased by 13% on the year, with higher supplies from across the continent, but other processed imports declined by 6% year on year.

Poultry

Chicken prices remain firm with poultry seen as a key BBQ commodity adding pressure for supply of thigh / wings / drumsticks and breast meat for kebabs.

One of the most versatile of proteins, poultry meat is easy to prepare and cook, low in fat and can lend itself to almost any flavour or coating.

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