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TheBeefSite Newsletter - 06 May 2015

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Wednesday 6th May 2015.
Michael Priestley - Editor

Michael Priestley

MSD Animal Health

Novus International

Beef is ‘Dancing to a Different Drummer’

Tight world beef supplies are leading to high prices across much of the key producing regions, although Europe has notable exceptions.

While the US beef industry expects another year of strong beef prices close to the heady levels of 2014, a strong sterling and Russian sanctions could spell trouble for some EU producers.

Scottish farmers have even been reassured of a food labelling investigation in light of low prices. Some suspect foreign meat is being labelled incorrectly as UK beef as people rationalise the 20 pence per kilo drop in abattoir prices on last year. read more

In England, falling beef prices showed ‘no signs of slowing down’, according to analysts at levy board EBLEX last week.

Irish values remain ‘relatively stable’ but EBLEX said supplies are tight, offering support to beef prices, along with lower imports.

Unknowns in the market were principally fiscal and relating to the behaviour of the dairy sector and consumers. read more

A further question mark hanging over the industry is what effect milk quota abolition will have on beef supply. read more

For Europe as a whole, beef prospects look poor, concerned farmers told the European Commission last month and its not just the dairy sector to blame.

Agricultural cooperative and union Copa-Cogeca said Europe lost its main buyer when Russian embargoes were imposed in August last year.

Russia is also key for Brazil, which has enjoyed strong exports as it has watched the real weaken amid the throes of economic downturn.

However, Russian buying tailed-off last year, which will be a key factor to watch in the coming months being Brazil's second market, said agri-business analyst Rabobank, summarising the situation at the end of the first quarter.

Meanwhile, the bullish US outlook stems from further supply contraction as herd rebuilding gets underway. read more

In a recent article, University of Illinois economist, Professor Chris Hurt, highlighted beef cow slaughter as being markedly lower for the second year, further pulling down beef output.

The tightness of supply is demonstrated by a 42 per cent rise in Canadian feeder cattle shipments to the US last year, which increased further in the first quarter by 14 per cent.

Currency strength is supporting this trade, which is seeing high Canadian cattle prices as the sector looks to rebuild its own beef herd.

Professor Hurt’s article, Beef industry dancing to a different drummer this year, highlighted the marked improvement in poultry, pork and dairy supplies, leaving beef as a likely winner in 2015. 

However, he pointed to large price risk for cattle feeders, who are 'vulnerable' despite the lowest feed costs since 2010. 

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This Week's Articles and Analysis

Getting Into Beef Production
There are many aspects of beef production that a farm can focus on, or some farms opt to get involved in all aspects. If you are just thinking about starting in beef you need to decide what aspect of production fits your land, labour and financial resources.

Milk Quotas and Beef Herd: What Will the Effect of Quota Abolition Be?
Many are questioning what role the dairy herd will play in the beef herd going forward as many dairies look to expand after 30 years of quota restriction.

Best Practice in Calf Rearing
Calf rearing, Australians have been told, is like a jigsaw, with many vital elements all fitting together in balance.

Fluffy Cows: Getting Behind the Internet Sensation
Pictures of pampered cattle went viral on the internet last year. A science student and beef ambassador explains they aren't a particular breed, they've just been given special attention.

Cattle Have No Close Contact With Badgers
Electronic collars have shown that cattle do not commonly interact with badgers at close range.

Market Reports

USDA Bi-Weekly International Meat, Poultry & Egg Review - 5 May 2015
EBLEX Cattle and Sheep Weekly - 5 May 2015
USDA Agricultural Prices - 1 May 2015
UK Agricultural Industry Total Factor Productivity 2014 - 1st Estimate
UK Total Income from Farming 2014 - 1st Estimate

Global Beef Industry News


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Volatility Takes its Toll on UK Farm Profitability
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CME: Livestock Futures Rebounding After Last Week's Falls
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   Saudi Arabia

Lumpy Skin Disease Found in Saudi Arabia


Slight Drop in Average Price of Chinese Farm Produce


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   European Union

Red Tape Removal Needed for Trade Talks Success

   New Zealand

Fonterra Price Falls Again


Uruguay Meat Exports Up


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