UK beef exports to US frozen

UK beef exports to the US are frozen for the remainder of 2022, with the blockage set to hit UK exporters.

The UK transported 2,574 tonnes of beef worth £11 million in 2021 and £1.3 million in January 2022, but the US quota for this year has already been filled.

Dr Phil Hadley, AHDB international market development director, said: “Quota levels and the 26.4 per cent tariff on further shipments mean that UK and other EU exporters who use the Other Country (OC) specific quota will no longer be price competitive and will therefore cease to ship to the US.”

UK access is predicated on availability of 60,000t of OC quota.

But beef from Brazil and Central American countries comes under the same allocation, meaning the UK is affected by Brazilian exports.

“Brazil’s BSE case and subsequent bans in China meant that they have switched volume to US,” said Dr Hadley.

“The result is a rapidly filled quota with impact on others who use this route.”

by John Wilkes / Farmers Guardian

UK red meat exports up on pre-pandemic levels

Exports of red meat from the UK were worth more than £1.45 billion in 2021 – up £33 million on pre-pandemic levels despite a challenging year for exporters.

Many markets increased imports of UK red meat, in particular in Asia, figures by AHDB show, despite a number of factors impacting trade last year.

The Asian marketplace continues to be incredibly important for the UK pork sector, representing 55% of pig meat exports in 2021.

Last year, pork exports to the Philippines increased three-fold and shipments to South Korea doubled.

And while China – the biggest export market for UK pork – imported 16% less pork last year than 2020, it was still home to 42% of all pork exports, with shipments of offal up 17%.

Japan, which opened its doors to UK beef in 2019, also saw a 48 percent increase in shipments last year.

The EU still remains a key market for beef exports, representing 71% of beef shipments from the UK, but AHDB says third country markets are growing.

Farming UK

Cull cow prices up, up and away

In recent weeks, cull cow prices have been climbing, with the GB overall cow price reaching a record breaking high last week.

In the most recent week, ended 12 March, the price climbed a further 7p, to 316.7p/kg. Meanwhile, the GB all prime average increased 2.1p, to 410.8p/kg. The clean cattle premium over cows is now at one of narrowest points on record.

Estimated prime kill for the week totalled 31,100 head, 400 head fewer than in the same week last year. Meanwhile, estimated cow kill fell 800 head to 9,800 head. Availability of prime cattle in the coming year is likely to remain tight compared to historic levels.

There is an increased numbers of younger animals on the ground compared to January 2021, but numbers are lower than 2 years ago. At the moment, processors are competing for supplies, which is supporting prices.

Rebecca Wright / AHDB

Sheep prices dip

Finished lamb prices fell in the latest week. The GB liveweight OSL SQQ was 259.10p/kg in the week ending 16 March, down half a penny on a week earlier.

Good supplies were available; auction market throughputs were 7% higher than a week ago, at 114,400 head.

Deadweight prices didn’t fare any better, the SQQ falling by more than 9p to 565.1p/kg in the week ending 12 March. Those carcases meeting the R3L spec fell by 6p to 570p/kg.

Estimated slaughter in the week was 222,000 head, another strong week, and 17% more than in the same week last year. In the year so far an estimated 2.12m clean sheep have been sent forwards, 5% more than at the same point a year ago.

Duncan Wyatt / AHDB

Warning of 15% inflation as feed prices soar

Food security is set to crumble in light of potential hyper-inflation caused by the ongoing war in Ukraine, according to the boss of the UK’s largest poultry manufacturing company.

Ronald Kers, 2 Sisters Food Group CEO, said he believed hyper-inflation could be the highest since the 1970’s oil crisis with food inflation rocketing to 15% by the middle of this year.

The unfolding Ukrainian agricultural crisis could have massive repercussions for global commodity supply and Kers is urging cross-territorial collaboration to insulate states from future geo-political crises.

The Ukrainian crisis will result in “a threat to food security”

Commenting on the Ukrainian crisis, Kers spoke of an incredibly worrying time for colleagues and supply chain partners in the country: “This conflict brings a major threat to food security in the UK and there is no doubt the outcome of this is that consumers will suffer as a result. War disrupts the free flow of trade and the impacts for us are severe. For example, the input costs of producing chicken – with feed being the biggest component – have rocketed. Prices from the farm gate have already risen by almost 50% in a year.

“Before this war began, 4-5% food inflation was being forecast by mid-2022. But we could now see a hyper-inflationary environment at closer to 10-15% – more than it has been for 50 years – if this conflict isn’t resolved quickly.

Poultry World

GB deadweight pig prices

The UK-spec SPP rose to 136.24p/kg for the week ending 12 March, an increase of 0.41p/kg from the week before.

Although reports suggest some processors have substantially increased their weekly contributions, as these sometimes only form part of the contract price, it will take a little time to materially move the SPP. However, this does provide the industry with some springtime optimism.

Estimated slaughter was also up for the week at 199,500 head, the highest figure of 2022 so far. Carcase weights remained steady this week at 95.88kg/head.

Weaner prices averaged £32.85/head this week which is the first recorded price we have this month.

The UK-Spec APP rose 0.61p/kg to 141.91p/kg for the week ending 5 March, widening the gap between the APP and SPP to 6.08p.

AHDB

Ukraine conflict prompts feed shortage

ROME, March 18 (Reuters) – Carlo Vittorio Ferrari, who runs a farm holding 2,000 pigs with his brother near the town of Cremona in northern Italy, fears his fourth generation family business could be lost due to conflict in Ukraine.

The country is a major global supplier of animal feed, stocks of which are falling fast across import-reliant southern Europe.

With Hungary, Serbia and Moldova also banning exports as they safeguard their own supplies, costs for farms like Ferrari’s have spiked, threatening their future. Many face culling animals if the situation doesn’t improve quickly.

“This is a family business. My grandfather kept it going during two wars, my dad saw one, but I don’t know if we’ll get through this one,” Ferrari said.

Italy has called for EU rules limiting state aid to the sector to be waived, while Spain has taken steps to allow emergency purchases of corn from Argentina and Brazil.

“I hear growing reports of farmers slaughtering their animals, but I want to avoid that,” said Elisabetta Quaini, who keeps 1,300 cows for beef and milk production on her farm in Lombardy, northern Italy. “I’m determined to keep going, but I am very worried.”

Gavin Jones, Cristiano Corvino / Reuters

KFC and McDonald’s halt operations in Russia

Yum! Brands, the parent company of fried chicken chain Kentucky Fried Chicken (KFC), as well as McDonald’s, have announced the suspension of operations in Russia.

“This action builds on our decision to suspend all investment and restaurant development in Russia and redirect all profits from operations in Russia to humanitarian efforts,” said Yum! Brands in a press release.

Those humanitarian efforts, says Yum! Brands, include a US$1 million donation from the Yum! Brands Foundation to the Red Cross to support those affected by the crisis, activating the Yum! Disaster Relief Fund to support Ukrainian franchise employees, and matching donations from employees to various charities providing relief in Ukraine. “In addition, our franchisees in the surrounding regions are providing food for refugees,” said the company.

Yum! Brands is also finalising an agreement to suspend all Pizza Hut restaurant operations in Russia, in partnership with its master franchisee.

Yum! Brands reportedly has at least 1,000 KFC and 50 Pizza Hut locations in Russia that are nearly all independent franchisees. Some 70 KFC sites are company-owned restaurants.

by Poultry World

Pig producers welcome big Morrisons price increase

Pig producers have hailed Morrisons and urged other retailers to follow suit after it significantly increased the price it pays to its farmers.

Morrisons will increase the weekly contribution paid by its processor Woodheads by a massive 30p to 180p per kg.

Other processors were reportedly up 10-15p on Friday and this followed price hikes of 12-16p the previous week.

However, the contribution price is only one element of the contract – many are made up of several elements including part SPP, part tribune price and part contribution price.

The National Pig Association (NPA) had wrote to retailers urging an increase in pig prices to at least £2/pig “so producers can at least have a chance breaking even”.

Most UK pig producers were facing costs of production over the £2/kg mark, the body said, as the post-Ukraine wheat price spike pushed feed costs even higher.

The sector has already faced more than a year of heavy financial losses due to falling pig prices and a crippling on-farm backlog.

NPA chief executive, Zoe Davies said the move by Morrisons was ‘welcome and a good start’

by Farming UK

AHDB predicts weakening of EU pig prices

The Agriculture and Horticultural Development Board (AHDB) has predicted a weakening of EU pig prices in the months ahead as farmers are thought to have held back pigs from slaughter in anticipation of higher prices.

The speculation rests on the idea that EU producers have held back pigs and that the current shortage in slaughter pigs may ease soon. Combined with reports of good pork supplies in the EU market, AHDB anticipates these factors spelling future weakness in EU pig prices.

Pig meat production in the EU grew by nearly 2% in 2021, to 23.4 million tonnes, with 250 million pigs slaughtered. However, trade was lower across the year, especially in the second half, as demand from China fell, with the increase in production consumed at home.

Production fell in Germany (-3%) year-on-year, remained stable in Poland and France, and grew in the Netherlands (+3%), Denmark (+8%) and Spain (+4%).

The rise in Spain’s production secured the country’s top spot, with pig meat production at 5.2 million tonnes, much of this underpinned by exports, with China playing an important market.

By Iain Hoey / Pig World