Cattle and Sheep Weekly
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Cattle and Sheep Weekly

12 November 2021

Cattle prices retain strength

GB deadweight cattle prices stayed largely steady in the week ending 6 November. The all-prime price gained 0.4p to average 409.2p/kg. Within that, overall heifer prices were unchanged at 408.0p/kg, and overall steer prices increased by 0.7p to 411.3p/kg. Young bulls gained 2p overall to average 397.9p/kg.

Estimated prime slaughter was 30,600 in the week, 900 higher than a week earlier. Reports suggest supplies of cattle are fairly well balanced with supplies. While processing staff shortages remain in places, this does not appear to be having a material effect on throughputs overall.
Cow prices also showed a degree of stability, falling only a penny on the week to 259.0p/kg, after several weeks of more significant price drops. Estimated cow slaughter in GB abattoirs was 13,000 head, 200 more than last week. High feed costs will have some questioning the economics of feeding, especially indoors.

Lamb prices jump up

Throughout the past week lamb prices have increased sharply, with the weekly liveweight SQQ up almost 20p. During the week ending 10 November the GB NSL liveweight SQQ increased to 269.05p/kg. Such sharp movement is uncommon and usually follows, or is followed by a correction, unless throughputs are low, leading to volatile prices. Sharp movements are rarely sustained in the lamb market. There are two previous occasions in recent times, but both were downward price movements. The first was in March 2020 when the old season lambs SQQ dropped suddenly overnight as the UK and France both entered their first pandemic-related lockdowns. The other occasion was more recent and perhaps for less obvious reasons; in June 2021 lamb prices dropped sharply as they came off the record-breaking high spring price peak.
However, some industry comments suggest though that this movement up in price level could very well be sustained, with the potential for the increases to continue.

But why have prices risen? The short answer would be lack of supply, and why is that? Currently that is the million-dollar question. At current price levels, you would have expected numbers to be drawn out. This week we have seen auction market throughputs pick up with 134,000 head coming forwards, a week-on-week rise of 28%. Reports indicate that more would have been purchased if they’d been available. This pick up is still a drop in the ocean compared to the
lower kill levels recorded in recent months. Prices in France are strong and rising too, exceeding £6.50/kg in the week ending 1 November. A challenging shipping market is removing the potential for New Zealand to send large volumes into Europe.

In the week ended 6 November the GB NSL deadweight SQQ rose 23p, to 556.5p/kg. Estimated kill for the week recorded a decline of 15%, to 221,000 head.

UK sheep meat and beef production both lower in October compared to 2020

Lamb production

UK lamb kill was once again on the low side in October, according to Defra data. This is a trend we had expected to see throughout 2021, based on the idea that lambs were brought forwards for slaughter in H2 2020 rather than Q1 2021. This took account of the size of the 2020 lamb crop, and uncertainty due to the end of Brexit transition period.

Since then, the kill has been lower than expected and less explicable.
In October lamb kill totalled 1,107,000 head, down 11% on the year and 12% on the 5-year average. October is usually the peak month for lamb kill.

Adult sheep kill has also once again recorded a large year-on-year decrease, to stand at 100,400 head. Recorded ewe slaughter was 29% below the 5-year average for the month.

For the year-to October, production totals 214,600 tonnes, 11% below year earlier levels.

Beef production

the UK produced 74,500 tonnes of beef in October, according to data from Defra. This was 500 tonnes more than in September, but 6,300 tonnes less than in October last year. Production has been running behind 2020 levels all year. The effects of the terrible spring in 2018 have been felt all year, in some ways delayed by the pandemic which supported demand for British cattle.

Prime cattle slaughter was 159,700 head in October, 13,000 lower than a year ago, with declines seen across steers (-9%), heifers (-7%), and young bulls (-1%). This brings prime slaughter for the year so far to 1.64m head, 4% fewer than in 2020, and broadly in line with
our forecast.
61,800 cows were slaughtered in October, 4,650 fewer than in October last year. Given the prospect of sustained higher feed costs during the winter housing period, we might now expect cow slaughter to pick up. It has been behind 2020 levels since the summer. In the year to date 519,300 cows have been culled, 6% less than at the same point year ago.

Beef production in the year to date is 742,000 tonnes, 4% lower than last year, and again in line with forecast.

New AHDB service offers bespoke farm business support

AHDB has launched a new Farm Business Review service to help 4,000 farmers and growers in England plan, prepare and prosper in the future. The free, independent service offers a combination of an online self-assessment tool, expert advice and peer support to help businesses prepare for the biggest agricultural policy shift in a generation.

The AHDB Farm Business Review service runs until February 2022, so farmers and growers are advised to register now in order to benefit.
Click here to find out more.

AHDB report dives deep into Australia trade deal

Our latest Horizon report quantifies the potential economic impact of the Australia trade deal on UK agriculture for the first time. The new report offers in-depth analysis of Australian agricultural production and trade, assessing its potential competitiveness in the UK marketplace and the opportunities for UK agri-food products. Read the report here.

News in brief

Fertiliser prices continue to climb. The latest fertiliser price data shows steep rises in ammonium nitrate prices. We take a look at what’s driving this increase, and how farmers can manage costly nitrogen fertilisers.

Is bioethanol demand adding fuel to feed grain prices? Recent US bioethanol demand has been strong. With an average of 36% of US maize used for ethanol over the past 2 marketing seasons, strong demand supports Chicago maize prices. This in turn strengthens the wider feed grain complex, adding support to UK feed grains.


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