Beef finishers still waiting to profit from surge in British steak sales

AT THE start of the Covid crisis the closure of the entire hospitality sector accompanied by a huge spike in unemployment looked like it might push the Irish and British beef production sectors back to the dark days of EU intervention buying.

Instead, the volume of beef being consumed by our main market, the UK, has spiked. During lockdown British consumers renewed their love affair with home cooking, particularly red meat.

Analysis by Kantar shows that over a 12-week period ending May 17, consumer spending on red meat in the UK increased by 26.9pc, with the number of buyers of red meat increasing by 8.7pc.

The total spend on minced beef surged by 34.5pc, while the volume of retail steaks rose by 24pc. The increase in steak sales was most notable in the last four weeks of that period up almost 44pc.

Driving this surge was the decision by supermarkets to address the issue of beef carcase sales imbalance by offering steaks and other high end-cuts at far reduced prices.

In other words, dropping steak prices to balance sales of mince, and avoid the threat of a large overhang of unsold beef in the system

Morrisons, for example cut the price of their 8oz fillet from £7.04 to £3.52, with Waitrose offering three 150g beef sirloin steaks for €10 as opposed to €4.50 per individual unit previously charged, while the Co-op chain cut the price of their pre-packed sirloins, ribeyes and fillets by 25pc.

These price cuts were accompanied by highprofile media and in-store promotions in April and May.

On the back of these figures, the price to British farmers has climbed, with R3 steers now making the equivalent of €4.08/kg, while the equivalent animal in the North sits on €4.01/kg.

Irish producers on the other hand have seen little in the way of compensation from the market-place: prices here continue to lag in the region of €3.55-3.60/kg.

The question is, was it lowcost Irish beef that initially drove the upswing in UK demand, thus creating the surge in prices for British farmers?

Demand in the UK has now reached such a pitch that Northern processors and large wholesalers are

Northern processors are sending increasing numbers of agents south to marts in search of good-quality cull cows and heavy out-of-spec stock

sending increasing numbers of their agents south to marts in search of good-quality cull cows and heavy out-of-spec stock.

The difference in price is significant when compared to grid prices here.

And where are our grid prices this week? More or less in the same place they have been for the last month: €3.55-3.60/kg for bullocks and heifers, with bulls on €3.60/kg for Us, €3.50 for Rs and €3.40/kg for Os.

Cull cows remain at €3.103.00/kg for Rs, with Os at €2.80-2.85/kg and better Ps €2.70/kg or a shade stronger.