Weekly cattle & sheep market wrap - 21 March 2024

Key points:

Prices for week ending 16 March 2024

• Deadweight sheep prices continued to rally, with the GB OSL SQQ averaging 790p, up 46p from the previous week.
• Deadweight cattle prices showed mixed movement, with R4L steers easing back to 505p/kg and overall cows rising to 349p/kg.
• Opposing domestic supply dynamics at play for cattle and sheep. However, robust demand domestically and for export are keeping farmgate prices supported, particularly in the sheep meat market.

Cattle

Deadweight cattle prices showed mixed moves in the latest week, with prime easing back and cows ticking up. Prices for all prime categories weakened overall, with the average GB R4L steer measure down 2p on the week to 505p/kg. Meanwhile, the GB deadweight overall cow price rose by 1.2p to average 349p/kg.

All regions experienced downward price movements in overall prime categories, particularly southern steers, and northern heifers and young bulls. Meanwhile, all regional cow prices appreciated except for the northern region.

Despite the weekly moves, prime cattle prices remain elevated against 2023. Market reports suggest that retail demand is robust currently with Easter around the corner. The latest insight from Valentines Day showed that beef steaks performed well, while recent retail figures also point to robust demand for cuts including mince and roasting joints.

Estimated prime slaughter for the latest week suggest a marginal uptick (up 400 head). Weekly rates have now been consistently above 2023 levels for just over a month. For the year-to-date, estimated GB prime kill is now up 1.9% year-on-year.

Sheep

GB deadweight sheep prices continued to rally. In the week ending 16 March, the GB OSL SQQ averaged 790p/kg, up a staggering 46p on the week. The measure is now sitting 267p above year-ago figures, a 51% increase. Domestic lamb supply remains notably lower than the same week last year (-14%), although kill rose again in the latest week, up 6% from the week ending 9 March.

Market reports point to firm demand currently from both domestic retail and export, with Ramadan in full flow and Easter and Eid soon approaching. Valentines Day also saw lamb perform well. Indeed, although lagging, latest export data for January showed a 38% year-on-year rise in sheep meat volumes into France.

However, looking at the most recent week, lamb prices reported from Rungis wholesale market have been stable rather than growing,  suggesting a more balanced supply / demand picture of late. The price position of GB lambs could be playing a part here. As GB prices have rallied, the difference to French farmgate lamb prices has narrowed substantially over recent weeks, potentially challenging export competitiveness. The price difference between GB and French lambs does typically narrow during the first half of the year as French production peaks.

Price differentials for export are not the only factor to watch. It’s been well-documented that southern hemisphere lamb is extremely price competitive currently. Indeed, imports of New Zealand product rose notably in January, but arguably less than expected given the market fundamentals. There remain reports of some disruption to trade flows adding cost and offering some potential mitigation to quantities of southern hemisphere product currently available on the domestic marketplace. In addition, reports suggest that lambs in New Zealand have been slower to come to market this season, with one driver reportedly being producers holding onto lambs to add weight, in an attempt to mitigate lower farmgate prices.