The drop in beef price over the past few months is reflective of consumers buying less meat for economical reasons, and as a result less demand.
That’s according to beef sector manager with Bord Bia, Mark Zieg who was speaking to Agriland on the latest AgriFocus podcast.
“We have seen a number of weeks now where prices have been slipping and that’s not what we like to see,” Zieg said.
“It generally does happen at this time of year where we have increased supplies coming through, off grass in the autumn, but prices have been on the slide in fairness throughout Europe.
“The European price there is €4.74, reported last week; in March, it was €5.15. Our own, similarly, went from €5.28 back in March, to €4.72.
“Even the British price, that is considerably higher, it was £5.72 and then it is £5.27, so there is in the order of 40-55c gone out of all of those prices,” he added.
Consumers buying less
Zieg pointed out that the scale-back in demand for beef is not as a result of a trend away from animal protein, but rather consumers being more frugal as the cost-of-living crisis continues,
“It’s a reflection really of consumers buying less. Looking at UK Kantar figures, beef prices there for the year to date compared to the previous year… prices up by 10% and volumes down by 4%,” Zieg continued.
“So, there is a real correlation you see there everywhere that consumers are finding it hard to pay the extra money for beef. And there are cheaper proteins that they can reach for.
“They’re probably also eating less protein, or animal protein, overall. It’s not anything to do with an overall trend against animal protein, it’s really an economic thing.
“In the shopper insights, we see that consumers are still, what we call, ‘engaging’ with the category, so they want to buy… they come in, intending to buy beef, they have all of those positive associations around taste and nutrition, so they want to purchase, but ultimately, they are dropping off at the last point because they are seeing something better value somewhere else,” Zieg explained.
The comments from Zieg come as heifers are being quoted at €4.60-4.65/kg on the grid this week, generally speaking.
Bullocks (steers) are being quoted 5c/kg lower than heifers generally, with €4.55-4.60/kg on the grid.
At the higher-end of the price scale, in-spec cattle that were booked in earlier last week for slaughter this week are managing to secure prices a few cent above these price quotes, depending on the outlet.
The lowest price quotes for this week appear to be €4.55/kg and €4.60/kg on the grid for bullocks and heifers respectively.
Last November, steer price bottomed out at €4.50/kg on the grid and so far, none of the processors have dropped to this price level.
Beef supply
Zieg told the podcast that the reduction in the cattle supply is working in Ireland’s favour.
“They’re down here 30,000head, which has already happened, so that’s why we have, relatively for the year, quite a lot of cattle around at the moment but still, it’s not something unusual,” he said.
“For next year, we are seeing again that cattle numbers will drop, where it could be up to 60,000head less of cattle processed next year in Ireland.
“In Europe, there was 1.7% less cattle processed. That has been happening all the last number of years, so you have considerably less beef around.
“If we can hope that the economic situation does improve, we should see that coming back because, going back to shopper insights, it’s not that consumers are saying ‘we’ve gone off meat’, they want to eat the meat, but it’s the economic situation,” he added.
Zieg pointed out that while Asia is proving popular for Irish beef exports currently, albeit China is still recovering from some Covid-19 fallout issues.
“Japan would be working quite well; China still [has] a few post-Covid problems that are affecting the economy,” he said.
“Maybe the US is a more immediate global opportunity; cattle numbers there have gone down a lot with the droughts.
“We’re still in the culling phase, where next year’s supplies will be quite tight and that could just, globally see more demand for beef and cattle in the world’s biggest beef consumption market and open up a few more opportunities we would hope,” he said
You can listen to the entire AgriFocus podcast with Mark Zieg from Bord Bia on Spotify, Apple Podcasts or by clicking here.