Beef industry faces many challenges

Recently beef farmers have seen their costs dramatically increase in all areas, but it is mainly the feed, fertiliser and fuel that has weighed heavily on the business.

Store cattle prices and finished cattle prices previously did increase to a level that many felt was sustainable allowing then to move two steps forward but then the increase in costs simply moved them three steps backwards.

“The farmer is the only man in our economy who buys everything at retail, sells everything at wholesale, and pays the freight both ways.”– John F. Kennedy

Slurry regulations that will come into force whereby 22 weeks storage must be provided means some will need significant levels of investment, which will lead to not being able to financially afford or justify it.

Cattle finishers want more return with their product but with the current economic squeeze the retailers will not want to increase the retail price and face consumer resistance.

Usually it in turns leads to a rise in imports filling the shelves but with imports more expensive because of the weak pound it can mean potential increase in prices.

The retailers end of year profits will still though be at gob smacking levels, just in line with those in the fuel and energy industries recently announced. Yet the consumers are seeing inflation rise well above any pay rises being given.

In any moment of decision, the best thing you can do, is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing. We cannot hide from reality. With most livestock farms it will be the sheep that have been the positive sector that continues to drive any form of making profit.

It is not the time for policy to be 'going slow in the right direction,' as many just cannot wait and when policy arrives there it will have been too little, too late. Changes are happening now, and many cannot wait for policy to get there. When decisions are made such as tree planting as we see now then it simply cannot be switched back when policy does come along.

Spring cows being scanned early and what is not in calf will be culled after weaning. Some recent breeding sales have seen in-calf cows with their calves being purchased by other herds who are looking to increase numbers, or simply replace older cull cows for a younger herd. Yet other cows not back in-calf with calf at foot are often just being separated with the cow being sold to the abattoir.

Recent census figures indicate more heifers retained so with the buoyant cull trade there will be a number of farms putting more heifers to the bull.

The cull cow values have been the most lucrative of any of the other beef enterprises. Simply they supply the low value cuts such as mince which they consumer is now more focused on. Care must be taken if selling herds in terms of tax implication and so clear guidance by accountants is important. The next few months will certainly be the best indicator where breeding numbers will go.

A path was given to allow efficient production and lower emissions but somehow what seen as positive amongst industry was side lined. Considerable time and effort went into the report by leading figures and those with the knowledge needed. They were thinking well ahead as did 'Noah who built the arc long before it rained'. To many, it is now raining. Farmers make decisions quickly and many will soon put counter measures in place.

With a dry weather spell for many, rather than thriving on the green summer grass some have resorted to feeding their winter feed/forage already outside. A significant number of farmers in the drier areas sacrificed second cut silages to allow cattle and sheep to graze them.

Soon calculations will be needed to estimate how much forage and feed is available on farm for the winter and base cattle numbers on it. Many do not want to be purchasing feed based on current levels, but the grain price has eased back lately. Will feed companies adjust accordingly? Will it be cheaper to retain or purchase the lower priced grain and also purchase protein and do own mix?

Livestock farmers need all feed available to be purchased and how can it be justifiable to see much of it redirected into current or proposed anaerobic digesters.

The decision on what to sell is next, such as reducing cows and keeping the stores or just selling the stores. However, the careful examination of the store sales needs to be undertaken and too many into the market will lower trade.

Are finishers looking for the more forward types and will all weaned calves be wanted. Soon, many weaned calves will come on the market but it has to be remembered that it is not for everyone and the strong continental types with good weights will sell well but there will be more hesitation in the more 'hairy' lighter longer-term calves .

While most areas have had a very dry summer, other areas especially in the more western areas have faced a difficult wet season, which as caused them harvesting forage. They will now be faced with substantial increases in costs.

Purchasing feed is already incredibly higher than last year along with the delivery charge. With feed costs, delivery and all other input costs increasing, the lift in livestock values will not match. Livestock numbers could also take a hit and if many do continue, they will face increasing strain on their finances. Future environmental and conservation will almost certainly be affected.

Simply putting cows away does not result in same level of overheads also going down the road that day. The result can often be less output but more costs per livestock unit left on the farm. A plan has to be in place of what do with existing overheads of sheds, buildings and machinery. Also, what is the impact to many with their sheep enterprises. Cattle and sheep work off each other as do beef and arable enterprises.

Many look for other forms of incomes in areas such as renewables and diversification. Others look at utilisation of sheds such as taking on cattle on contract which includes a growing interest in specialist rearing of beef from the dairy. It does allow good financial planning as you know the level of income coming in each month.

Since 2018, Scotland has reduced the suckler herd by 2.5%, yet the beef registrations have increased by 3.4%. Yes, the effect of more beef coming for the dairy as the dairy farms utilise dairy sexed semen. The English suckler beef herd has fallen 7% In the same time period and beef registrations have risen by 3.5%.

Beef from the dairy give incredible uniformity if it’s just mainly Angus or British Blue used on their Holstein and Friesians. However, those rearing and finishing these cattle are also finding their margins evaporate.

Livestock producers who have the scale and scope to winter outside and maximise the hill, upland with their hardier, maternal-type cows can make it work. They have the cow for the environment but still put continental bulls over to produce the right calf/produce for the marketplace.

This system really does keep costs down, but not everyone can do it. There can be no doubt that those who have dedicated considerable time to altering their grass systems have certainly made an impact with lower inputs. In fact, many no have no artificial fertiliser being put on.

More cover crops after earlier harvest may well be sown and this too can help winter housing.

But in many other areas there is still a seven to eight-month winter and they don’t have choice but have invested in structure such as buildings. They need encouragement to produce.

Beef cows don't just provide calves for meat, but they play a crucial part in reaching our environment and biodiversity objectives. Both need each other. Recently in many areas of Europe the devastating fires were often in areas simply where stock no longer graze and the vegetation has been allowed to grow.

Food does not simply appear, and those who believe that we can just import it are really failing to understand that this puts a reliance on others and with situations lately in areas such as Ukraine we cannot just expect. Other parts of the world are drying up and will not have the output that we believe. China also wants increasing levels of protein.

If we want success, then don’t rely on other people to do what we can do.