Trends and prospects in the EU beef sector
06 April 2013
According to the EC’s report, ‘Prospects for agricultural markets and income in the EU 2012–2020’ published in December 2012, EU beef prices “remained at exceptionally high levels” throughout 2012, reaching €3,900/tonne in October. This was “21% higher than the 2007-2011 average”. However, the effects of these high prices on net producer incomes were reduced by “higher feed costs” and drought-affected grazing, which reduced cattle farmers’ profit margins.
Developments in EU beef production remain linked to developments in the dairy sector, with around two-thirds of production coming from the EU dairy herd. The years 2010 and 2011 mark a high point in EU beef production (with an average of 8,222,000 tonnes carcase weight equivalent/c.w.e.) and consumption. While production levels fluctuate, average production is projected to be 3.3% below the levels attained during the period 2009–11. Average consumption is also reported as being lower, though be it on a variable trend up to 2022.
In terms of imports, figures for the first 8 months of 2012 confirmed “the declining trend of EU beef imports” (-5.1% compared to the same period of 2011). EU beef exports, having enjoyed major growth in 2010 (+180%) and further growth in 2011 (+30%), are projected to have fallen by 43% over 2012.
Up to 2022, “EU beef meat imports are expected to grow in the projection period to reach 357,000 tonnes by 2022”, compared to imports of 287,000 tonnes in 2011 (+24.7%). With the exception of 2015-16, when a small drop is projected, this is a period of steady growth in EU beef imports.
Exports, meanwhile, are projected to decline until 2015, before showing a steady increase through to 2022, recovering to 174,000 tonnes by 2022 (+72.3% between 2012 and 2022, but 47.4% below the peak level of 2011).
EU beef production, consumption, imports and exports 2009–2022 (actual and projections, tonnes carcase weight equivalent)
| Year | Gross production | Consumption | Imports (meat) | Exports (meat) |
| 2009 | 7,982,000 | 8,191,000 | 359,000 | 91,000 |
| 2010 | 8,239,000 | 8,188,000 | 319,000 | 255,000 |
| 2011 | 8,206,000 | 8,006,000 | 287,000 | 331,000 |
| 2012 | 7,831,000 | 7,739,000 | 268,000 | 190,000 |
| 2013 | 7,756,000 | 7,737,000 | 291,000 | 175,000 |
| 2014 | 7,860,000 | 7,896,000 | 300,000 | 151,000 |
| 2015 | 7,943,000 | 8,039,000 | 308,000 | 101,000 |
| 2016 | 8,043,000 | 9,131,000 | 305,000 | 115,000 |
| 2017 | 8,028,000 | 8,123,000 | 316,000 | 131,000 |
| 2018 | 8,016,000 | 8,113,000 | 324,000 | 147,000 |
| 2019 | 8,006,000 | 8,108,000 | 338,000 | 162,000 |
| 2020 | 7,987,000 | 8,097,000 | 355,000 | 176,000 |
| 2021 | 7,971,000 | 8,091,000 | 358,000 | 174,000 |
| 2022 | 7,961,000 | 8,087,000 | 358,000 | 174,000 |
Source: EC, ‘Prospects for agricultural markets…’, December 2012, Table 7.23
Editorial comment
Strong EU beef prices should bring better returns for ACP exports of extensively grazed, grass-fed beef, producers of which are less severely affected by rising animal feed costs. However, reduced numbers of export grade cattle offered for slaughter in Namibia in 2012 (down 24.37% compared to 2011), as a result of much higher prices for weaner cattle, reduced the volume of beef available for export in 2012 (see Agritrade article ‘ Prospects for Namibian beef exports to China’, 4 January 2013).
The year 2011 was an exceptional year, with the EU emerging as a net exporter of beef and veal meat. However, through the projection period to 2022 the EU becomes a net importer once again. This continues the post-reform trend in the EU. The renewed expansion of EU beef exports from 2016 onwards coincides with a continuing steady projected decline in EU exports of live animals and the abolition of EU milk production quotas.
The critical issue for the ACP, however, is the growing emphasis on the targeted marketing of ‘fifth quarter’ cuts from the UK to certain markets in West and Central Africa. These lower-quality meat cuts can be seen as directly competing with local production in mass markets in urban areas, particularly in coastal zones. This needs to be seen in conjunction with the rise in exports of EU low-quality poultry cuts to African markets.
These projections raise difficult policy choices for ACP governments vis-à-vis the relative importance to be attached to fostering national and regional beef and poultry supply chains, compared to securing low-cost sources of protein for urban consumers in an era of rising global food prices.
