Outlook 2025: Efficiency needed to secure beef market benefit

The UK breeding herd has once again contracted, with June 2024 data showing a further 4.5% decline over the year.

The previous year saw the greatest fall in female animals of beef breeding age in more than 10 years.

Reducing suckler herds and a shift to dairy beef continue to drive the trend, according to Andersons consultants Charlotte Dun and Ben Burton.

The growth of dairy herds in Scotland and Northern Ireland has outweighed the reduction in England and Wales; forward projections suggest that the UK dairy herd will continue to increase its share of the overall UK cattle population.

See also: Wagyu beef market – tradition and change in Japan

British Cattle Movement Services (BCMS) data project a tightening of beef supply in Great Britain.

Calf numbers during 2023 fell by 4.3%, driven predominantly by falling suckler cow numbers.

This caused suckler calf registrations to reduce at an accelerated rate, outweighing the growth in dairy beef calf registrations.

Global beef markets remained well-supported through 2024, due to firm demand and lower supply in most parts of the world.

In the UK, producer prices were strong, thanks to good consumer demand and higher exports.

UK competitive on global market

Considering the current price position, the UK remains competitive on the global market.

The negative supply projections for 2025, here and across key global markets, suggest support for cattle prices is likely to continue.

Robust beef prices will have incentivised culling and will continue to do so.

Pressure on margins within the beef sector has intensified over recent years.

That, coupled with volatile global markets and testing weather conditions, means profitability remains uncertain for beef producers, even with high prices.

In the longer term, global demand for red meat is expected to grow in the coming decade due to sustained demand from developing regions.

Demand growth in developed markets including the UK is forecast to be minimal, but the global picture is encouraging for UK export prospects.

Due to its climate, weather and extensive production systems, the UK is one of the most sustainable places in the world to produce red meat.

Beef producers have an opportunity to ride the wave of an expanding global market, but they must remain focused on efficiency and performance.

Buoyant prices are not enough to offset the impact of recent agri-inflation and rising overheads. Resilient profitability is driven by controlled margins and good technical performance of stock.

Changing consumer attitudes

Consumer preferences are evolving. While population growth drives total world consumption, trends such as health and sustainability concerns are expected to gather pace.

In higher-income countries, consumers are becoming more concerned about health, the environment and animal welfare, particularly when it comes to beef.

Products that satisfy environmental and welfare concerns typically come at a higher price, which often has greater influence on consumer choice.

Consumer views on red meat, especially processed categories, may therefore limit long-term growth.

Retailers may need to consider reminding younger consumers of the benefits of consuming lean red meat.

As public health challenges increase, government intervention − such as high in fat, sugar or salt (HFSS) regulation − has the potential to shift demand away from processed categories that fall within these descriptions.

The UK beef industry has an opportunity to improve demand by promoting the health benefits of beef, such as vitamin B12, iron and protein, and demonstrating UK farming values.