Market Bulletin December Latest survey figures shows further growth in Welsh sheep numbers In November the Welsh Government released its June Survey of Agriculture and Horticulture. The figures showed that the number of sheep in Wales was 5% higher year on year. The total number of cattle and calves was 1% lower and pig numbers were down 4%. This Market Bulletin will look at these figures further. Sheep The increase to the national flock, to 8.62 million head, was driven by a 1% rise in the number of lambs younger than 1 year old on Welsh farms. This gives a clear indication that the Welsh flock this season has recorded a better lambing rate than in recent years. The excellent lambing conditions have generally continued throughout the year and a slightly increased breeding flock in December 21 contributed to this increase. Welsh ewe numbers were up marginally at 4.12 million head, on the back of a 3% increase in 21. The growth in the breeding flock is expected to continue, one reason for this would be the increased confidence in the sector due to improved market prices. ( head) 6, 5,5 5, 4,5 4, 3,5 2 21 22 23 24 25 26 27 28 29 21 Source: Welsh Government Sheep numbers in Wales Breeding ewes Lambs (< 1 year) While this growth is welcome, the total number represents a relative low point for Welsh sheep numbers in recent times, and is 27%, or 3.15 million head, lower than the historic high of 11.77 million in 1999. Since this point the combination of Foot and Mouth, long running unprofitability and the de-coupling of subsidies has done much to erode sheep numbers in Wales. Cattle The latest figures for the total cattle herd in Wales shows a 1% decline in numbers to 1.12 million head. This decline was a result of fewer cattle between 1 and 2 years old in the herd, down 3% at 252, head. The number of cattle aged over two years was down 1% at 559, head. Of the 559, cattle aged over two years, the number of dairy bred animals was up marginally at 275, while beef animals were down 2% at 237,. The majority of these females will represent breeding stock, however some will be intended for slaughter as prime cattle. The number of males aged over two years fell 8% to 47, head. Cattle aged under one year recorded little change overall, however female numbers were up nearly 4% at 175, head, while the number of males fell back 3%. This is likely the result of fewer dairy bred males being kept for finishing as high cereals prices over the preceding 12 months have severely dented the profitability of finishing young bull intensively.
( head) 32 3 28 Female cattle numbers in Wales (aged 2 or more years) Dairy breeds Beef breeds 26 24 22 24 25 26 27 28 29 21 Source: Welsh Government Historically cattle numbers have declined considerably since a peak of 1.58 million head in the mid 197s, but the latest figures also represent a marked decline from pre foot and mouth levels. At its current level the Welsh cattle herd is 12% lower than in 2 when it numbered 1.32 million head. Pigs Welsh pig numbers in June were 4% lower at 26, head than in 21, this was driven by a 4% fall in the number of fattening pigs. The number of breeding sows was up 2% at less than 5, head. At its current level the Welsh pig herd represents less than 1% of the total number of pigs in the UK. Historically Welsh pig numbers have declined to less than 1% of their peak, recorded in 1965. ( head) 3 25 2 15 1 5 24 25 26 27 28 29 21 Source: Welsh Government Pig numbers in Wales Breeding pigs The total land in agricultural use in was marginally higher than in 21 at 1.72 million hectares. The amount of permanent pasture increased by 2% to 1.5 million hectares while, there was a 13% increase in the area of grassland under 5 years old, at 117, hectares. The area of rough grazing fell by moiré than 1% to 44, hectares
Consumer Statistics Retail sales of lamb drop while beef and pork sales improve -52 w/e 2/1/11 Pork Lamb Beef -25. -2. -15. -1. -5.. 5. 1. 15. 2. % Change Average Price Volume Expenditure Beef and pork increase total red meat market share while lamb market share declines - 52 w/e 2/1/ 5.7 51. 52.4 29.1 3. 31.5 16.2 15.1 12.3 4. 3.9 3.9 Beef Lamb Pork All Other Meat Supermarkets continue to gain red meat market share at expense of Butchers & Others -52 w/e 2/1/11 86.9 88.4 88.9 9.6 8.4 7.9 3.5 3.2 3.2 Total Butchers All Others Supermarkets 29 21
Cattle Prices p/kg lw 195 185 Welsh prime cattle prices 29 21 Production Statistics Prime cattle prices at livestock markets have fluctuated since the beginning of October and are currently below the high of 187p/kg recorded at that point. Latest prices showed some improvement on the previous couple of week reaching 184p/kg in week ended 19 November. 175 165 155 145 135 Cull cow prices also improved but are still below the highs of earlier in the autumn at 117.9p/kg in week ended 19 November. While being below the levels recorded earlier in the year prices remain firm compared with year earlier levels, attributable to tight global supplies limiting imports and subsequent strong demand for UK exports. Deadweight prime cattle prices in England and Wales have Source: AHDB continued to increase since October with the overall steer price reaching 331p/kg in week ended 12 November. Young bull and heifer prices have also increased reaching 318.2p/kg and 33.6p/kg respectively in the same week. Slaughterings head 18 16 Welsh cattle slaughterings 29 21 Welsh cattle slaughterings in September were 11% above year earlier levels at 14,3 head. With production 12% higher year on year at 4, tonnes, it is likely that the slaughter mix had an increased number of heavier animals such as steers in it, as carcase weights are lower throughout the UK so far this year. 14 Figures for England and Wales indicate that much of the uplift 12 would have been as a result of increased cull cow slaughterings. 1 With considerably fewer young bulls being slaughtered, overall prime cattle throughputs were only 3% higher year on year in 8 September at 14, head. While cull cow throughputs in Source: Defra England and Wales were 21% above year earlier levels at 38,6 head. As a result of the increased throughputs, beef production in England and Wales was 11% higher year on year at 54,5 tonnes. EU Prices per 1 kg dw 39 37 35 33 31 29 27 25 23 21 19 Source: EU Commission Average EU cow and steer prices O3 cows 21 R3 steers 21 O3 cows R3 steers The tight supply situation that has been driving domestic cattle prices higher has also influenced the EU trade. EU male cattle prices have generally increased over recent weeks, and continuing the trend for were significantly above year earlier levels. R3 steer prices since the beginning of October have increased by over 16 per 1kg to reach a new high of 373 per 1kg in week ended 13 November. This was driven by considerable increases to both the UK Irish reference prices. Prices for young bulls and heifers have also appreciated significantly in recent weeks, while cow prices have been more subdued.
Trade () tonnes 16 14 12 1 8 6 4 In August, UK exports of fresh and frozen beef were 43% higher year on year at 12,6 tonnes. The increase in export volume was aided by higher production, particularly for cow beef, which is in strong demand on the continent. There were increased volumes to the three main markets of the Netherlands, Ireland and France, up 74%, 35% and 23% respectively. Between them these three countries take over three quarters of UK beef exports. The only two countries to record a noticeable decline in shipments were Italy and Germany. 2 In the year to August, exports totaled 91,8 tonnes, 4% 29 21 29 21 higher than year earlier levels. The picture for the year to date Imports Source: GTIS, HM Revenue & Customs Exports mirrors that of August, with higher shipments to most markets with the exception of Italy and Germany. As a result of increased trade to non-eu markets, these exports accounted for 4% of the total trade, up from 3% in the corresponding period in 21. Imports of fresh and frozen beef in August were down 1%, there were no shipments from either Argentina or Botswana. This comes as production in Argentina has been very limited and the ban on imports into the EU from Botswana remains in place; volumes from France and Namibia were also down. These declines were somewhat offset by increased shipments from other EU countries, Australia, Uruguay and New Zealand. Household Purchases UK trade in beef Jan-Aug (%) -1. -15. -2. Beef Performance (Volume) in Wales, 12 w/e 2/1/ 1. 5.. -5. Household purchases of beef in Wales decreased by 5.5% to 5,219 tonnes in the 12 weeks to 2 October. Volume sales of stew increased by 4.6%, while sales of roasts, frying/grilling beef and mince decreased by 15.7%, 11.5% and.7%, respectively. Expenditure on beef in Wales during the same period decreased by 2.3% to over 33 million compared to the same period of 21 and the average price increased 3.4% to 6.33/kg. Sheep Prices p/kg lw 28 26 24 22 2 18 16 14 12 Welsh SQQ lamb prices 29 21 Source: AHDB Welsh lamb prices have started their seasonal increase recording continuous growth since the start of October. Over this period liveweight prices have increased 24p to average 187.8p/kg in week ended 19 November. This represented an increase of 28p year on year. These increased prices were attributable to a number of factors. The general uplift in prices that occurs at the end of autumn as the weather turns and demands increases, followed by the Muslim festival of Eid which fell on 6 November stimulating both domestic and export demand. Combined with this was the generally buoyant picture for exports and the tightening of numbers over the latest weeks, which has given an extra boost to prices.
p/kg dw 59 57 55 53 51 49 47 45 43 41 39 37 35 33 31 29 Source: AHDB GB lamb overall SQQ 29 21 Cull ewe prices at Welsh auction markets have also been firm, recently trading above the 5 per head mark. In week ended 19 November cull ewes averaged 53.7 per head, an increase of 5 per head since the start of October and 9 per head higher than the corresponding period in 21. The seasonal uplift in prices appears to be well under way for the deadweight trade as well. Since the beginning of October the SQQ has increased by over 23p to average 396.2p/kg in week ended 12 November. As with the live trade these increases are generally attributed to increased demand, both domestically and for export, the Eid festival and some tightening of supply. Prices are currently around 1%, higher year on year per 1kg dw 75 7 65 6 55 5 45 4 35 Slaughterings head 55 5 45 4 35 3 25 2 15 Source: Defra Average EU heavy and light lamb reference price At 418, head total Welsh sheep slaughterings during September were up by over 2% compared with year earlier levels. With carcase weights continuing to be higher year on year mutton and lamb production was up by more than 3% at 7,6 tonnes. In the year to September, total sheep slaughterings were 7% higher year on year at 2.54 million head, while production was up a similar amount at 46, tonnes. English and Welsh figures for September indicate that lamb carcase weights were up 1% while adult sheep carcase weights were down 2%. Throughputs of lamb at English and Welsh abattoirs for September were 3% higher year on year at 989, head with adult sheep numbers down 3% at 153, head. As a result lamb production in England and Wales was up nearly five per cent at 18,5 tonnes with mutton production down five per cent 3,8 tonnes. EU prices Welsh total sheep slaughterings 29 21 EU-25 heavy lamb prices have improved in recent weeks driven by improvements to the three main markets of the UK, Ireland and France. At 5.5/kg dw (433p/kg) the reference price has risen by over 25 cents since the start of October. Over this period there was a 3 cents rise in the UK reference price to reach 4.61/kg (395p/kg) in week ended 13 November. With the UK representing the largest proportion of the overall reference price this was the main driver in the EU-25 price increase. Irish prices were also 3 cents higher than at the start of October, up to 4.4 /kg (377p/kg) in the latest week. The French reference price rose 21 cents over this period to average 6.33/kg (543p/kg) in the latest week. Heavy lambs in the EU context are defined as lamb carcases weighting more than 13kg. Heavy lambs 21 Light lambs 21 Heavy lambs Light lambs Light lamb prices continued to increase throughout October Source: European Commission reaching 6.83/kg (59p/kg) in week ended 6 November before dropping to 6.72/g (576p/kg) in the latest week. The Spanish price was the main driver behind these trends, having reached 8.1/kg (699p/kg) in the last week of October and first week in November. Prices then eased to 7.84/kg (672p/kg) in the latest week helping to drag the overall EU reference price lower. Light lambs in the EU context are defined as lamb carcases weighing less than 13kg.
Trade () tonnes 1 9 8 7 6 5 4 3 2 1 UK imports of fresh and frozen sheep meat during August were nearly 3% higher year on year at 5,4 tonnes. Imports from New Zealand were only down 6% as their production season ended with a flourish increasing availability to some extent. In the preceding seven months imports from New Zealand had been down 2%. The continuation of lower shipments from New Zealand was more than offset by increased imports from a number of other markets, notably Australia and Ireland with shipments up 12% and 58% respectively. There were also increased volumes from Spain, Chile, the Netherlands and Germany. Imports Exports Source: GTIS, HM Revenue & Customs Year to date imports totaled 67,5 tonnes, a year on year decline of 15%; this was driven by New Zealand shipments being down 19% as a result of production difficulties during the key part of the season. This was somewhat offset by a 34% increase in volumes from Australia, while Iceland and the Falklands also sent more sheep meat. Shipments were down from most other markets. During August exports of fresh and frozen sheepmeat were 4% higher than year earlier levels, at 9,2 tones. There continued to be a decline in shipments to France and Belgium, down 2% and 29% respectively, combined with a 5% decline in volumes to Ireland. This was offset by increased shipments to Germany and Italy which were 28% and 65% higher. Shipments to non-eu markets were up considerably driven by larger volumes being sent to Vietnam, Hong Kong, South Africa and China. Exports to these markets accounted for 5% of all exports in August compared with 3% in August 21. Year to date exports were up 7% on the year, at 58,7 tonnes. This increase was driven by higher shipments to Germany, Ireland and Italy. Volumes to France and Belgium were down generally as UK product has been less competitive on these markets due to higher UK prices, competition from Ireland and increased domestic production. Exports to non-eu markets were up by nearly two thirds totaling 3,3 tonnes. Household Purchases UK trade in sheep meat Jan-Aug 29 21 (%) -1-2 -3-4 -5-6 Lamb Performance (Volume) in Wales, 12 w/e 2/1/ Household purchases of lamb in Wales decreased by 28.9% to 1,149 tonnes in the 12 week period to 2 October. Volume sales of mince, leg roasts, chop steaks, shoulder roasts and stew decreased by 51%, 45.6%, 21.4%, 16.7% and 2.3%, respectively. Expenditure on lamb in Wales during the same period decreased by 16.4% to 9.6 million compared to the same period of 21, and the average price increased 17.7% to 8.39/kg.
Pigs Prices p/kg dw 16 155 15 145 14 135 13 125 GB Deadweight Average Pig Price 29 21 The monthly average DAPP for October was little changed from September at 145.52p per kg. Following their seasonal fall, prices stabilised in the first half of the month, significantly earlier than in recent years, before rising in late October and early November. As a result the October price was nearly 7p higher than in October 21. The recent rise has taken the DAPP to 147.25p per kg in week ended 12 November, more than 1p higher than the same week last year. The price increase has come despite supplies remaining relatively high. Robust demand in anticipation of a positive Christmas market, strong export demand and high EU prices have all played a part in driving prices higher. Source: AHDB/BPEX Weaner prices have also begun to strengthen, having hit a low point of around 4 per head in mid October. The average price for the month was 4.31 per head, marginally below the September average, but prices have since increased, reaching 42.1 by week ended 19 November. This is virtually the same as a year earlier, when prices were falling. Recent reductions in the cost of feed have meant that more places have become available with finishers. Slaughterings Welsh pig slaughterings head 4 3 2 1 29 21 Source: Defra Welsh pig slaughterings between January and September totaled 25,8 head, up 1% on year earlier levels; with increased carcase weights pig meat production was up 14% year on year. In England and Wales during September clean pig slaughterings totaled 627, head, up 1% on the same month last year. The total in the first nine months of the year was 5.7 million head, an increase of 8% year on year. With cull sow slaughterings also increasing, but carcase weights slightly down, pig meat production in England and Wales during the first nine months of the year was up by 7% at 6, tonnes. EU prices per 1 kg dw 165 16 155 15 145 14 135 13 125 Average EU pig meat reference price 29 21 Source: EU Commission The general stability in the EU average pig reference price, which has been apparent since May, continued through the first half of October. This is a very different trend to recent years, where prices have normally peaked in the summer before falling back rapidly during the autumn. By the end of October prices are typically 12 per cent lower than in mid-august; this year they had fallen by less than 1%. Although supplies have been tighter in some Member States, the higher price is largely driven by export demand from non-eu markets, particularly in the Far East. The October average EU price was 156 per 1 kg dw, 19 higher than in October 21. From late October, prices began to edge higher, at a time of year when they are normally falling. By week ended 13 November, they had reached nearly 16 per 1kg.
The weakness of the euro in recent weeks has meant that the rise in EU prices has been less pronounced in sterling terms. Therefore, the gap between UK and EU prices has only narrowed slightly, averaging 6p/kg during October. This is a much lower premium than in the previous two years. Amongst major producers, only in Italy and Spain have prices followed a different trend from the EU average. Italian prices have continued their upward trend evident since Easter, reaching almost 197 per kg in mid-november, easily the highest in the EU. Spanish prices have been on a downward trend, albeit less sharply than in earlier years. Having been above the EU average for most of the year, they have now fallen to around 4 beneath it, although the Spanish price did edge higher in week ended 13 November. Trade 3 275 25 225 2 175 15 125 1 75 5 25 () tonnes UK trade in pig meat Jan-Aug 21 Pork exports Pork imports Bacon imports Source: GTIS, HM Revenue & Customs UK imports of fresh and frozen pork during August totaled 3, tonnes, 5% higher than in August 21. Shipments from Denmark accounted for just over a third of total volumes, but were virtually unchanged from the same month last year, although this follows a large increase in imports from Denmark during July. Most other major sources of imported pork shipped larger volumes than in August 21, with the biggest increase coming from Ireland, up by 19%. As a result, imports of fresh and frozen pork for the first 8 months of the year now show an increase of 6% compared with the same period in 21. In common with the pattern throughout the year to date, bacon imports in August were lower than a year earlier, with volumes down by 2% to 23, tonnes. In contrast, imports of sausages were up by 15%. Exports of fresh and frozen pork from the UK in August were 42% higher than in August 21 at 12, tonnes. Exports to most markets were up, but the growth was driven by shipments to Hong Kong, which took the largest share of UK pork exports for the second consecutive month. There were also dramatic year on year increases in exports to South Korea, as a result of the ongoing impact of the FMD outbreak there, and to Cyprus, which took much higher volumes than normal during the month. Pork exports for the first 8 months of the year were up 18% on the same period last year, totaling 94, tonnes. Over the period, Germany remained the largest market, with shipments being 5% higher than year earlier levels. Household Purchases (%) 5. 4. 3. 2. 1.. -1. -2. -3. -4. -5. Pork Performance (Volume) in Wales, 12 w/e 2/1/ Household purchases of pork in Wales decreased by 2.5% to 3,631 tonnes in the 12 week period to 2 October. Volume sales of loin roasts, leg roasts and chop steaks, increased by 4.7%, 6.3% and 4.9%, respectively. However sales of shoulder roasts were down 38.1% and belly sales were down 15.3%. Expenditure on pork in Wales during the same period increased by 5% to over 18 million compared to the same period of 21, while the average price increased by 7.7% to 5./kg.
Latest News Improved fertility the key to improve suckler calf returns Improving fertility is the key to profitable beef production, according to red meat promotion agency Hybu Cig Cymru. Latest figures show that the average calving interval on a Welsh farm is 446 days, compared with best practice of 37 days. That means that the average Welsh cow is costing farmers 76-1 for every day that it is not in calf, HCC chairman Dai Davies told the organisation s annual conference in Cardiff. An average Welsh farmer with a herd of 25 cows is therefore losing almost 2, a year in lost production. The situation becomes clearer once the sucker calf production costs are examined. In the year ending March, market returns for suckler calves on the average Welsh farm covered just 63 per cent of their costs. Even the top third performing farms only covered 96 per cent of their costs, while the bottom third covered less than half of their costs at 47 per cent. These figures are a stark reminder to farmers of the importance of keeping costs under control, and maximising the potential of their herds, said Mr Davies. While market returns have improved since these figures were compiled earlier this year, costs have also continued to increase at a disproportionate rate. That s why farmers should look at ways they can take control of matters to maximise their income, and improving fertility is a key area. Fertility can be affected by numerous factors, including herd health, nutrition, body condition score, sire choice and general management strategy, amongst others. HCC has introduced schemes to assist farmers combat some of these problems. For example, one such project involves testing and control with the ultimate goal of eliminating Bovine Viral Diarrhoea (BVD). The disease can have a major impact on the fertility of the herd if left unchecked, leading to reduced conception rates and an increased risk of embryonic death, as well as protracted calving periods and stillbirths. HCC has recruited 1 farms to take part in the 4, project which is funded through the Rural Development Plan for Wales and delivered by the Welsh Regional Veterinary Centre (WRVC). The findings of the project will be communicated to the industry via presentations at HCC farmer meetings and events as well as via the media, said Mr Davies. In the meantime farmers can keep a close watch on their costs and try to minimise them wherever possible to try and improve their returns. 1 Million RDP project to boost Welsh red meat industry completes its work A 1 million project to improve the Welsh red meat industry and help businesses to become more sustainable with a long term future has completed its work. Hybu Cig Cymru has managed the Rural Development Plan for Wales Economics and Benchmarking project for the past three years, completing a variety of tasks in that time. We have been working with the industry to help develop a well informed agricultural sector that will be better placed to make intelligent business decisions to meet market demands, said John Richards, HCC s Industry Information Officer. This in turn will help ensure the long term profitability and sustainability of businesses involved in the red meat industry. Hundreds of businesses have taken part in specific projects, such as benchmarking, Johne s Disease testing and onfarm health surveillance. In addition, the industry has benefitted from an improved information service which includes detailed website information, the publication of monthly market bulletins and a text messaging service.
More than 2, text messages giving farmers up-to-date market information are sent every month. In addition, hundreds of businesses have approached HCC directly over the last three years seeking detailed information about various projects and how they can use the information to improve their businesses. Although the RDP funding has come to an end, some of the services have proven to be so popular that HCC will continue to provide them. These include the text messaging service and market bulletins. Many of our services have proven to be extremely popular with the industry, which is why we have taken the decision to continue to provide them, said Mr Richards. All the indications are that the entire project has been a success, benefitting individual businesses directly involved in the projects and assisting others when we have analysed and distributed the information that has been gathered, he said. A detailed report on the success of the project is currently being compiled, and will be published in the New Year. EU signs off on 212 budget The European Parliament and finance ministers yesterday signed off the EU's spending plans for next year, paving the way for a budget increase that is less than the rate of inflation. Following a series of conciliation talks over the past month, EU member states and MEPs last week agreed to increase commitments by 1.86% year on year, with payments set at 129. An agreement on the funding of the EU's nuclear fusion 'ITER' project appears to have been pivotal in clinching the overall deal. An additional 1 million was agreed to finance the research, after the Commission had proposed member states pick up the tab as a way of cutting EU spending. MEPs had initially demanded a 5.2% year-on-year increase for the EU budget, but appear to have largely backed down in exchange for extra funding commitments for the current financial year. Centre-right Portuguese member José Fernandes Costa saw "no possibility of further cuts beyond those already made," while welcoming the 2m top -up to the bloc's spending on cohesion policies agreed by the Council. Agriculture spending will be trimmed by 86m year-on-year in real terms, to just under 44bn - 139m less than the figure put forward by the EU executive in its draft budget. And while farmers have been allowed access to 5m from the kitty if they are forced to leave the profession, member states rejected MEP and Commission requests for the European Globalisation Fund (EGF) to be made available to other workers made redundant due to the current economic crisis. "The political message the Council is sending to the European citizens by rejecting the proposed extension in times of continued crisis will affect the EU's credibility," warned Italian MEP Barbera Matera, Parliament rapporteur on the EGF. Costa also echoed claims by the budget commissioner Janus Lewandowski that the cuts in EU spending forced by member states would come back to haunt them next September, when the 212 budget is reviewed by the EU executive. "I predict the need for amending budgets to meet the expenses of cohesion policies," she stated this week.