GB beef consumption under pressure
Domestic demand for beef has been under pressure for some time, as consumers grapple with increased inflation. Volumes of beef sold through GB retail have been below 2022 levels since the start of the year, with decline seen in key cuts including mince and roasting joints.
Price is the key driver of lower sales, with consumers buying less per trip and switching to cheaper proteins. Beef performance in foodservice has been positive compared to a year ago, but this has been outweighed by declines in retail. Kantar retail data for the 12 weeks to 9 July suggests that demand has eased further, potentially reflecting variable summer weather.
Lower consumption is a trend that is currently reflected on the continent, with consumers reducing their out-of-home spend. Weaker consumption is expected to persist for the rest of the year, according to European Commission forecasts.
From a demand perspective, UK beef consumption is expected to remain subdued for the rest of the year, as people restrict their buying. Beef through retail may benefit from some shoppers moving their out-of-home spend in-home to save money, but AHDB predicts that reductions in volume and switching to cheaper proteins will contribute to overall consumption decline.
On the supply side, AHDB anticipates that domestic cattle supplies will increase seasonally towards Christmas, but overall cattle slaughter will remain below a year ago. Lower cattle availability may offer some support to cattle prices. However, the differential between the price of homegrown beef and that of imported product will be key to watch. With Irish cattle supplies expected to tick up towards the end of the year, and demand forecast to remain subdued in key export markets, this may point to further pressure on Irish prices.
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