Prime cattle values have reached record levels on the back of reduced supplies and increased demand from both domestic and international markets.

Latest figures show R4L steers in Scotland are valued at £5.23 per deadweight kg which is up 5p on the week, with heifers of the same grade rising 5.2p to £5.21.

Such is the increased demand that the GB All Steer and All Heifer price is also above the £5 per kg mark at 506.4p and 503.0p, up 2.4p and 2.1p per kg, respectively on the week.

Young bull and cow prices have also risen markedly with the average R3 bull in Scotland trading at 507.2p with cows of the same grade at 420p.

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According to Iain Macdonald, market intelligence manager at QMS, the increase in price is due to slaughter numbers remaining lower than the first half of the year.

“The significant rise in prime cattle prices reflects intense competition among processors, as they compete for cattle while the weekly slaughter rate begins to trend upwards. This is coupled with a general uplift in UK beef production during the first eight months of the year compared to 2023.

“During the summer, beef consumption tends to be slower due to people leaving the UK to go on holiday, but the post-holiday period has bolstered retail demand for beef.”

He added that Kantar data has shown a 6% increase in household spending on beef in Great Britain year-to-date in 2024.

Retail price inflation has also eased, which has brought a halt to the downward trend in sales volumes, with even a 3% year-on-year increase in the 12 weeks to early August.

In addition, demand at the lower end of the market appears to have firmed, with cow prices rising in recent weeks. This has occurred despite an expected seasonal rise in the availability of cows for slaughter, which typically pressures prices downward.

Furthermore, demand for UK beef for export has remained robust throughout 2024, with volumes up nearly 11% year-on-year between January and July, according to HMRC data. While much of this growth can be attributed to declining EU beef production, significant sales of lower-value products to non-EU markets like Hong Kong have also contributed to the rise.

Looking ahead, the coming weeks typically see a seasonal uplift in prime cattle throughput. However, Mr Macdonald cautioned: “The timing of the autumn peak in production varies each year.

"In 2023, for example, we saw a strong average kill in October, followed by a significant dip in November, which is unusual as production usually peaks in the lead-up to the festive period.”

The most recent cattle population data from the British Cattle Movement Service (BCMS) for July 2024 indicates a continuing increase in prime cattle numbers on Scottish farms, with a 2% rise in animals aged 12-30 months compared to July 2023. This is primarily due to a larger spring calf crop in 2022 and an increase in the 18-24 month age group, reflecting a decrease in store cattle movement to England.

“Despite the rise in prime cattle numbers, adjusting the slaughter data for cross-border trade suggests that fewer animals from this year’s herd have been processed than anticipated. When combined with an elevated number of cows leaving Scottish farms for slaughter, it suggests that producers may be replacing their less productive cows, positioning the sector for future productivity.”

Looking to the rest of the UK, the July cattle population data south of the Border shows a small decline in prime cattle aged 12-30 months, signalling potential tightening in supply once the current stock of older animals has been processed.

“As for store cattle availability, reduced calf crops across Great Britain in autumn 2023 and spring 2024 mean that availability will remain tight at upcoming autumn sales.

Demand for Scottish-born stores is expected to remain strong among finishers across the UK. Yearlings, in particular, are likely to be scarce, with the July population data pointing to a near 7% year-on-year reduction in animals aged 6-12 months in Scotland,” he concluded.