The continu
ing strength of the store cattle market may be welcomed by sellers as a means of restoring bank balances after the expenses of the past 12 months. However, observed Mr Ashworth, the underlying reasons for the improved prices continue to raise concerns about the longer term ability of Scotland’s beef industry to benefit from the opportunities created by a growing UK and global population and improving economic outlook.
The volume of 12 to 18 month old store cattle sold by price-reporting auction markets during the past month shows a 15% reduction in numbers and a 12 - 15% increase in prices, compared with the same period last year.
“This reduction in volume may be larger than was perhaps expected but is a reflection of the higher volumes sold earlier in the year as store producers faced slow grass growth and dwindling feed stocks in April and May.
“Nevertheless, it also reflects the reduced Scottish calf crop in 2012, particularly of beef-sired calves, a decline which gathered pace as 2012 progressed and which has continued into 2013,” said Mr Ashworth.
Higher mortality rates among younger cattle over the past six months have also contributed to the reduced number of stock being marketed.
The decline in beef-sired calf registrations has also been repeated in the north of England. As a consequence, English buyers continue to be active in Scottish store cattle markets creating extra demand for cattle and playing a part in supporting prices.
In contrast, those selling store lambs will be less content, observed Mr Ashworth.
Over the past few weeks store hill lambs have been typically trading £4 - £5 per lamb lower than last year and cross bred store lambs have also been trading lower than 2012. The volumes marketed through the price-reporting auction sales have reflected the season and been lower than last year particularly for hill lambs while some lambs may also have been lighter than last year.
Hence, supplies of both store cattle and lambs are lower than twelve months ago yet the markets have responded differently.
“The long term prospects of demand, for both beef and lamb, are set to benefit from a growing UK and global population, improving economic outlook and reduced volumes of stock on the market.
“So why have the two store markets responded differently this autumn? The answer to that conundrum may lie in the relative strengths of the current finished livestock prices and movements in feed grain prices,” he said.
While prime cattle prices remain at historically high levels, lamb prices have fallen in recent weeks and are currently slightly below the level of the past two years. Furthermore, the reduction in feed grain prices is more significant for cattle finishers than store lamb finishers.
Cattle finishers have little reason to doubt that supplies will remain tight and can see little threat from imported product and so remain confident about future cattle prices. However, store lamb finishers are more circumspect and wary of competition from New Zealand and the role of exports and exchange rates in underpinning prices as well as being mindful of the poor returns this spring.
Although the number of prime lambs reaching the market has increased in recent weeks, the UK 2013 lamb crop is widely acknowledged to be smaller than last year. This should result in greater competition among buyers, however producers have watched the lamb price slide over the past eight weeks and, mindful of last year’s price behaviour, remain cautious.
Furthermore, despite the forecast of a significant reduction in the 2013 New Zealand lamb crop, lamb finishers remain nervous about the volume of lamb that may be delivered into the UK market by New Zealand in early 2014 and the effect it will have on prices.
Hence, it appears the behaviour and degree of confidence of store livestock buyers is being significantly influenced by the differing performances of the current cattle and lamb prime markets.
ing strength of the store cattle market may be welcomed by sellers as a means of restoring bank balances after the expenses of the past 12 months. However, observed Mr Ashworth, the underlying reasons for the improved prices continue to raise concerns about the longer term ability of Scotland’s beef industry to benefit from the opportunities created by a growing UK and global population and improving economic outlook.The volume of 12 to 18 month old store cattle sold by price-reporting auction markets during the past month shows a 15% reduction in numbers and a 12 - 15% increase in prices, compared with the same period last year.
“This reduction in volume may be larger than was perhaps expected but is a reflection of the higher volumes sold earlier in the year as store producers faced slow grass growth and dwindling feed stocks in April and May.
“Nevertheless, it also reflects the reduced Scottish calf crop in 2012, particularly of beef-sired calves, a decline which gathered pace as 2012 progressed and which has continued into 2013,” said Mr Ashworth.
Higher mortality rates among younger cattle over the past six months have also contributed to the reduced number of stock being marketed.
The decline in beef-sired calf registrations has also been repeated in the north of England. As a consequence, English buyers continue to be active in Scottish store cattle markets creating extra demand for cattle and playing a part in supporting prices.
In contrast, those selling store lambs will be less content, observed Mr Ashworth.
Over the past few weeks store hill lambs have been typically trading £4 - £5 per lamb lower than last year and cross bred store lambs have also been trading lower than 2012. The volumes marketed through the price-reporting auction sales have reflected the season and been lower than last year particularly for hill lambs while some lambs may also have been lighter than last year.
Hence, supplies of both store cattle and lambs are lower than twelve months ago yet the markets have responded differently.
“The long term prospects of demand, for both beef and lamb, are set to benefit from a growing UK and global population, improving economic outlook and reduced volumes of stock on the market.
“So why have the two store markets responded differently this autumn? The answer to that conundrum may lie in the relative strengths of the current finished livestock prices and movements in feed grain prices,” he said.
While prime cattle prices remain at historically high levels, lamb prices have fallen in recent weeks and are currently slightly below the level of the past two years. Furthermore, the reduction in feed grain prices is more significant for cattle finishers than store lamb finishers.
Cattle finishers have little reason to doubt that supplies will remain tight and can see little threat from imported product and so remain confident about future cattle prices. However, store lamb finishers are more circumspect and wary of competition from New Zealand and the role of exports and exchange rates in underpinning prices as well as being mindful of the poor returns this spring.
Although the number of prime lambs reaching the market has increased in recent weeks, the UK 2013 lamb crop is widely acknowledged to be smaller than last year. This should result in greater competition among buyers, however producers have watched the lamb price slide over the past eight weeks and, mindful of last year’s price behaviour, remain cautious.
Furthermore, despite the forecast of a significant reduction in the 2013 New Zealand lamb crop, lamb finishers remain nervous about the volume of lamb that may be delivered into the UK market by New Zealand in early 2014 and the effect it will have on prices.
Hence, it appears the behaviour and degree of confidence of store livestock buyers is being significantly influenced by the differing performances of the current cattle and lamb prime markets.
