The surge in demand for beef and respective rise in Irish cattle prices that has been experienced this year are predicted to hold firm into the first quarter of next year, according to market experts on global meat and beef trade, Gira.
Speaking at a recent Bord Bia Meat Seminar, Gira’s Rupert Claxton outlined that China “is long-term going to have to import more beef and sheepmeat”.
“There isn’t enough protein in the Chinese market,” he explained.
He added that “beef, in the context of a high beef price and short supply, is still being bought” by major purchasers in world markets.
“Even with pork prices dropping, beef is still good and domestic supply is expected to be short this year.
“The second half of this year is crucial, if they are as short of cattle as we think they are, this will run into the beginning of 2022,” the meat sector expert explained.
Claxton believes that “it will be the second quarter of 2022 when we see it [the beef trade] turn”.
Commenting on supply trends in the beef trade on a global scale, Claxton outlined: “Due to Covid-19 meat plant closures in the US, some of last year’s cattle were not processed until this year”.
“There is an oversupply of slaughter cattle in the US at the moment which we don’t see in Europe.”
He explained that this is because beef processing plants in the US run “almost at theoretical capacity” which, he added, “is not the case in Europe where factories generally work off a five-day work week.
However, the Gira meat market expert noted that while the market for US beef is “really strong”, US cattle prices are currently “not reflecting where the market is at”.
Looking at trends on beef supply from Brazil – a major global player in the beef industry – Claxton outlined that there is less beef coming into EU market from Brazil than has been witnessed in previous years.
He also drew attention to the fact that feed prices in Brazil have “nearly doubled” given the depreciation of their currency and said this is “really hurting” their beef industry.
Despite this, he explained that production of beef is up in Brazil and said that the Brazilian beef trade to China is “strong”, but added their supply to the rest of the world is “weak”.
Commenting on China’s beef trade with Australia, he noted that the trade war between the two countries is continuing to have an effect and noted that many beef processing plants in Australia remain delisted by China and cannot supply beef to the country.
Concluding, Claxton added that there is “not an abundance of beef available globally” and attributed this to the fact that China “is buying it up” which he said is “great news for EU beef price”.