Live cattle exports suffer decline in volume but rise in value

It has been widely reported in previous months that the live export of Irish cattle to the continent of Europe had been impacted somewhat by the effects of Covid-19.

For 2020, live cattle exports tallied to over 265,880 head.

Comparing this to the levels of exports from 2019, there has been a significant decline of over 30,000 head in the number of cattle that left the Republic of Ireland.

However, in reports released this week by Bord Bia, the overall value of these live cattle exports increased from being worth €118 million during 2019 to be valued at €133 million in 2020. This rise in value has been attributed to the change in mix of cattle exported last year.

Having the custom of live exporters at cattle marts is crucial in maintaining pricing competition ringside and this certainly was proven to be the case throughout 2020.

This week, AgriLand spoke with Joe Burke from Bord Bia to get his insight into the performance of the live export cattle trade for the year of 2020.

Northern trade

Last year we saw a large rise in the levels of cattle imported to Northern Ireland, which is a market that had previously diminished back in 2018. It aided the mart trade majorly throughout the year for both store and finished cattle.

In total, there were some 64,200 head of cattle exported to Northern Ireland, which experienced an annual rise of over 30,700 head.

Speaking on the dramatic increase in Northern Ireland custom, Joe explained:

It was mainly driven by an increased differential between cattle prices in the Republic of Ireland and the UK or Northern Ireland. If you look at cattle prices around Europe, the UK was a far stronger market on average.

“The R3 steer price actually increased by 20% in the UK, which was interesting because the R3 steer price only increased by 1%. On average cattle prices actually decline around Europe by 2% in 2020.

“This just shows that there was a two-tiered market in 2020 and it meant that the UK became a more attractive destination for our live cattle and the demand for our cattle increased significantly.”

Dairy exporters

Dutch market

The Covid-19 pandemic played its role in causing a decline in calves being exported to the Netherlands in 2020, which contributed majorly to the overall decline in total live exports.

The lockdown of the food services resulted in over 42% or 35,650 fewer cattle travelling to Holland last year. Commenting on this hit to the market, Joe explained:

“The year didn’t get off to a bad start when we looked at February and March – but as the pandemic started, it really began to hit at market level.

“The Dutch veal market obviously became significantly impacted and they quickly realised that the demand for veal was going to be reduced. This is because it is a premium protein and targeted, to a large extent, to the food service sector.

“A lot of it is exported to high-end restaurants in Italy, France and Germany which obviously had a bad year.

“This lead to a significant decline in the finished price of veal, which led to a significant decline in the overall number of calves imported by the Dutch industry last year.”

drivers food irish exports live export exported cattle

Spanish and Italian market

The Spanish and Italian market were also hit with a decline in calf exports during the first half of last year, although they recovered better than the Dutch market as the year progressed into the autumn.

Exports to Spain and Italy reached over 81,280 and 21,771 head, respectively, last year. This had experienced declines of 10.5% and 27.8% on 2019 levels.

Speaking about the impacted trade to Italy and Spain, Joe stated:

“Again, the driver of these declines would be due to the appetite for calves in the second quarter of the year between April and June.

Even though some of these countries wouldn’t have been as heavily reliant on the veal trade – at the same time the fact that the food service was closed for a lot of the spring and the summer months it definitely had a detrimental effect on calf exports.

“Albeit the demand for live exports as reared calves/runners did recover somewhat to markets such as Spain and Italy once things started to re-open later in the year,” Joe added.

Regaining the Belgium market

Despite all the talk of decreases in exports, there were some positives to consider. This included a slight recovery in trading of cattle to the Belgian market.

A figure of over 4,220 head of cattle were transported to Belgium last year, which has risen annually by 1,268 head.

Although this is a small growth in the live export market, there is potential for further expansion according to Joe, as he stated:

It is positive to be able to regain this market which had been impacted for a good while.

“Belgium would have been a market which we would have sent relatively large numbers of calves into for many years, but this all stopped a number of years ago when Belgium declared ‘article nine status’ for infectious bovine rhinotracheitis (IBR).

“This meant that we were not able to gain full access to that market.

“Then there was a slight change in [Belgium’s] interpretation, whereby the calves could be judged on the herds they were coming from and the vaccinations of these calves.

“Again, a good few of these calves would have been exported to Belgium before the lockdown in March. We would have exported a lot more calves to this market if it was not for the Covid-19 issue,” Joe concluded.