Cheap beef – is there even any out there?

Last Sunday, we took a drive to Stirling area to see how the countryside was looking. We passed a field being cut and I could not believe my eyes at the short, light swathe. Now I know some people like very young silage but I have to admit I thought this was much too short for it to be economical in a field of 30 acres!

In contrast, I spoke to a farmer who walked his silage field to see what the volume was like, then he checked it again four days later and he thought it had doubled in that time, purely because of the higher temperatures that we have been enjoying, nor were there any heads in sight. The weather certainly came right for the early silage makers this time.

Coming home from Ayr Market, on June 3, there certainly was plenty of slurry being spread and hopefully there was not too much burning of aftermaths, with the dry weather that followed. Grass is Scotland’s largest conserved feed. It appears that first cut has been done in excellent conditions this year. Hopefully, the later upland farms will be lucky too.

Just a short note on rainfall, April, 0.25 inches; May, three inches. I have a friend in Forfar who recorded seven inches for May – usually it is the other way around! Another rainfall fanatic on the Black Isle recorded five inches in May and it is usually only 1.5 inches.

One of the worst jobs in the world must be politics, especially with all the back-stabbing that takes place and the difficulty in knowing who is telling the truth. Having said that, there are a few who tell it as it is, one being our ex CabSec, Fergus Ewing.

There is no hiding the fact that I am disappointed he has gone, especially because of the work he has done in setting up the Farmer-led Groups (FLGs), led by my colleague, Jim Walker. Those hand-picked groups put a great deal of effort into coming up with ideas that would take our industry forward into this so-called, new world of climate change and still have an industry left to feed the nation.

So, with only the third rural 'minister' in position in almost 20 years, Mairi Gougeon has two successful pairs of 'wellies' to fill – firstly, Richard Lochhead, and secondly, Fergus Ewing, as she takes up the new challenge of having to keep Scotland’s farming industry profitable. If it is not making a margin, we simply will not have an industry and then the question will be asked – “Where is our food going to come from?”

Having said that, if you have read Alasdair MacNab in the May 29 issue, you would wonder what is causing all the fuss, especially after studying his 'Comparison of changes in annual Co2 emissions, over the last 100 years.' If he had separated tiny wee Scotland, the figures would be even more stark.

I also found out the other day that a 747 jet from London to New York emits more pollution than all the cows in Scotland do in a year! I have to admit, maybe it is my age, but I am very sceptical of all this talk about pollution, especially here in Scotland.

Looking out of our house windows, there is definitely more greenery around than there was 50 years ago, especially with the ending of the coal pits and steel works in Coatbridge. We have far more self seeded trees. Fence wires now last much longer. Historically it used to be the wire which rusted first, now it is the wooden fence posts!

Another challenge is initially the proposed Aussie agreement that the bureaucrats of Westminster are so desperately trying to put in place! Their only goal in mind is cheap food, not caring from where in the world it comes, how it is produced and conveniently forgetting about the air miles and the pollution to get it on supermarket shelves, cheaply!

However, as I have said before, I doubt if there is much so-called cheap beef in the world. The headlines in the Aussie farming papers last week: 'Aussie beef farmers getting the highest beef prices in the world!'

Which could well be true, so I contacted my friends down-under to find out the true facts. At Tongala Auction Market, last week, 2300 store cattle, steers and heifers, averaged £2.30 per kg, or almost the same as here Leongatha, in Victoria, 4770 head Hereford and Shorthorn crosses averaged 248p per kg and in another sale, 1100 Angus cattle averaged 275p per kg.

Prime cattle were making 398p/kg, slightly less than here – but the expectation was that it would break the £4 per kg bracket. Supermarket prices had fillet at £17.77, sirloin at £11.11, rib-eye at £16.11, mince at £5.48, rump at £9.87 and silverside at £4-93 (all per kg). Butcher shops were marginally higher – for example, my favourite rib-eye here is around £20.08 and the Aussie butcher price was £22.21.

So, it begs the question, where is Boris and Ms Truss going to find cheap beef from in this Aussie deal. Remember Argentina has just banned exports of beef for a month because of the country’s inflation problems.

Since this Aussie deal has hit the farming headlines, I've been asked if I think we can compete? I can only tell you what I know from a distant relation, beef farming in Australia, who has a feedlot that finishes 10,000 black cattle per year, and it has been surviving for many years.

The stores are bought from both markets and direct from ranches where the cows are never housed. They come to the feedlots at around 400 kg and go out at 620 kg live. His average dead weight is 330kg.

Like everywhere else in the world, he says his margins are far too tight. The diet is maize-based, which is the feed most used in the Southern hemisphere and the beef is excellent to eat, largely because of its consistency. This is achieved because of the grading system, not only in Aussie, but also in the US and Canada, where I have personally experienced the eating quality. I cannot comment on either Brazil, Uruguay, or Argentina, but from what I have gleaned from my laptop, their situation is similar.

So, how can we compete with these countries? My opinion may not be popular with many people, but after a trip to Kansas with Eddie Gillanders in 2016 and Montana in 2019, it made me wonder how can we compete in quality and consistency? If we do not change our grading system, we are always going to struggle.

Hundreds of people who have travelled the world are saying the same thing, including many Nuffield scholars. Do we need to change our breeds? There is no doubt that Angus and Stabilisers seem to be popular world-wide.

Are our average weights too high? It would seem that the world is changing to lighter carcases of 330kg, as opposed to the Scottish average of 365kg. Seemingly, the rest of the World prefers thicker steaks, rather than large in circumference! In the UK, if we move to more natives, can we utilise more grass and silage as opposed to expensive cereal diets?

It will certainly cost less to keep smaller cattle, especially if it can be done from grass and silage. Are some other costs too high such as auction costs, abattoirs and are there too many people living off the backs of our beef sector?

For example, I have been to an abattoir in US where Scotland’s weekly kill is done in a day! Surely that must be more efficient, which then begs the question, do we need the number of abattoirs we have in Scotland?

There is no doubt that if the profitability in finishing beef cattle continues to decline then it is inevitable we will see abattoir closures. One only needs to read the excellent article on Thomson and Michael Wilson in last week’s publication where they make it clear, as I said last month, that a minimal of 420p/kg is where the beef price needs to be if there is to be a future for the beef sector.

I have a friend in the North who regularly criticises QMS for using the wrong people in advertising. He thinks it should be more high profile, household names! It appears we are going to have a supporter in the form of Jeremy Clarkson, who now owns a 400ha farm. Due to covid-19, he turned his hand to more hands on farming and realised the hard work involved, but especially the shameful profitability – he is going to do a TV show about his findings.

Finally, the stark reality of the state of UK farming was published last week by Defra. Its figures revealed a drop in profit of 20% in 2020, compared to 2019. Almost all the fall in farming profits is represented by the reduction in the value of outputs, as the costs overall were similar to the previous year.

Supermarket food costs must rise soon with the increase being paid to the primary producers! They do not hesitate to whack 65p on to a litre of tonic, or 50p onto a 500ml bottle of Coke!