With the year drawing to a close it is important to reflect back on the performance of the beef sector both at mart and factory level – but we also need to consider how our beef exports and retail markets fared during 2020.

As part of a review of the sector for 2020, AgriLand conducted a wide-ranging interview with Edmund Graham, beef chairperson of the Irish Cattle and Sheep Farmers’ Association (ICSA), to get his opinion on the industry’s performance.

‘Beef sales were very strong this year’

Graham was quick to highlight that beef sales at retail level were very strong this year even though Covid-19 had impacted the food-service sector in a massive way. He explained:

For the last 12 weeks, beef sales were up by 15% in Ireland and close to 6% in the UK.

“Obviously the levels of produce being sold to restaurants was hit, but people were still willing to go out and buy our beef products in the supermarkets – which brings a bit of positivity.

“Bord Bia had estimated that the total cattle slaughtered would be down for this year but we have actually seen a significant rise in the kills of cattle – which will hopefully mean that there is less cattle on the market for finishing in the first few months of next year.

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“In terms of factory price, we have seen an increase at the beginning of this month which is great to see – but looking forward into January, it is hard to predict any price rise forthcoming.

“Comparing our quotes to neighbouring counterparts, there was a huge division developed between UK and Irish beef prices of 40-60c/kg at one stage.

“Although, a positive spin to put on this is that the Northern buyers have been confident in purchasing southern cattle in the marts and this boosted the trade,” he added.

‘Quality weanling bulls met a good demand’

Although bull-beef finishing systems have suffered a decline during 2020, Graham noted the demand for top-quality bull weanlings from the suckler herd has continued from finishers. He added:

It is becoming more and more evident that if suckler farming is to remain viable, we are going to have to focus on producing top-quality animals. There is no room for these average weanlings that are not going to command a high price.

“We need to take a leaf out of the dairy farmer’s book. They are breeding high yielding cows either in liquid or solids, because they are getting paid for it. The suckler farmer needs to do the same and aim to breed real top-quality weanlings from good quality cows.

“We have seen the high-end and quality breeding heifers achieving top-prices this year in marts, so it’s good to see farmers are willing to pay that bit extra for quality.

Across the country, the prices for store cattle are up by 12% compared to last year. The northern buyers have been very active since the middle of the summer and have put a really great floor under the trade.

“It is my understanding that the weekly kills are down in the UK at the moment, so the fact that we having northern customers coming down and competing to buy our cattle for export really is great to see.”

Brexit and markets for beef

The performance of the industry is going to be massively hinged on Brexit, according to Graham. He stated:

We may to have to focus on getting more of our product out to mainland Europe, China and the rest of Asia. Hopefully, we will see the re-opening of the Chinese market shortly once the Covid-19 situation settles down.

“The logistics of getting our produce over to mainland Europe is going to be another stumbling block. We have already seen how the ports are impacted with heavy queues of lorries – although understandably the Covid-19 travel ban also had a role to play.

“Another issue is, if we do get our beef product out to mainland Europe, will the market for our beef remain? Because we don’t want to be flooding the market.”

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Graham went on to explain how changes may be experienced in market demands at EU level in the coming year following recent studies.

“Consumption for beef across Europe is set to decline by 1.2% for next year; however, beef production is also set to reduce by 1.4% – so hopefully the impact from these will cancel out each other.”

Kepak

Keeping the simple things in mind

As Graham spoke, he mentioned how it can be so easy to get caught up in the prices achieved in marts and factories and that few appreciate the good weather we had this year.

We have had a good grass year and I think cattle were able to thrive well. A good thrive in a dry year is as good as getting 10c/kg or 15c/kg extra in a bad wet year.

“Fodder is in high supply this winter as well on most farms and should see farmers out to the spring – which is something that is very valuable I think,” he concluded.