Rising UK beef production caused by heavier carcass weights is stifling hopes of a recovery in prices, as trade fell to a fresh low this week.
The UK average deadweight price for an R4L steer fell by 2p/kg to 336p/kg for the week ending 7 September, with the all-prime average 1p/kg lower at 325p/kg, according to AHDB figures.
Prices are around 45p/kg back on the year, with poor consumer demand, higher production and a reduction in average export prices contributing to the price falls, the levy body said.
See also: Commercial focus improves sales and EBVs in Angus herd
Analysts had hoped that production would tighten towards the end of summer based on projections that fewer cattle would be available for sale, due to fewer calf birth registrations in the past two years.
However, there is no sign of a change yet, with the AHDB reporting that cattle slaughter numbers in August were almost exactly the same as last year at 160,000 head.
Supplies have actually increased as there was an increase in the average prime carcass weight, which rose by 7.1kg (2%) compared with the same month last year, sending an estimated additional 1.1m kg of beef into the supply chain.
AHDB livestock analyst Felicity Rusk said that 1.32m prime cattle have been slaughtered in the year to date, an increase of 0.2%, while cow slaughter numbers are down 3%, but have picked up in the last month.
New marketing group seeks extra members
Beef producers are responding to the torrid prices by looking at alternative routes to market to shore up their income.
A Hampshire farmer has launched a beef marketing company and is looking for more farmers to get involved with the promise of above-market prices.
Jack Stilwell, who created Green Lanes marketing group six months ago, says he can secure farmers a price 3-8% higher than the open market rate and is hoping to take cattle from farms nationwide.
Mr Stilwell, who also runs his own cattle finishing business, has already signed up 50 farmer members with a total of 11,000 cattle and has an open-ended agreement with two supermarkets that will allow him to supply more volume.
He said bringing good-quality cattle into a larger pool for marketing is one of the few ways farmers are able to increase the strength of their negotiating hand.
“If you are producing a really high-quality product, which a lot of farmers are, then you have real sway,” he said.
All finishers must be Farm Assured, but there is no minimum herd size requirement for farmers wishing to get involved.
He is targeting producers that finish animals at 14-18 months of age, with a maximum deadweight of 340kg.
“There are jobs and spaces for all breeds, from good continentals and natives through to Holstein/Friesian steers and cull cows.
“If they are 280-320kg deadweight you are bang in the [supermarket] sweet spot,” he said.