Beef market trends
Both global and local beef prices are expected to increase going forward, as sit-down and takeaway restaurants reopen, given the easing of COVID-19 lockdown restrictions, resulting in improved demand levels, according to ABSA AgriTrends.
Domestic prices will be supported further by warmer weather conditions as the summer season approaches. High maize and soybean prices are likely to have an impact on the feed costs of cattle.
International beef market
During the week of 18 September 2020, the price for steers and cows rose 0.9% and 2.5% respectively in New Zealand. New Zealand’s steer and cow prices were 6.2% and 7.3% lower respectively than prices last year. The New Zealand government has placed a temporary halt on cattle export applications following the disappearance of the Gulf Livestock 1 vessel carrying 5 800 cattle and 50 crew. This will put some stress on companies that have already purchased heifers for live export consignment and could see exporters offloading heifers onto the New Zealand market, which may have an impact on prices. China imports about 27% of their live cattle from New Zealand and market players will not want this relationship to be put in jeopardy.
Local beef market
Average Class A prices increased 3.1% to R47.28/kg in the local market during the week of 18 September, while Class C prices rose 0.8% to R40.25/kg week-on-week. The local weaner calf price has been trading upwards in recent weeks due to high demand, with prices increasing 6.7% week-on- week. The current weaner price 25.8% higher than a year ago. Demand for beef products remained strong while a limited supply provided support for prices.