There are some challenges across key markets but improvement is expected in 2023 for the United States, Silver Fern Farms says in its latest beef market report.
The U.S market continued to track lower on pricing, leading into Thanksgiving weekend, which was celebrated on Thursday 24 November. There is no change to previous reports that heavy U.S domestic production and large volume imports from Brazil are the main factors continuing to move prices lower for frozen.
Chilled demand for premium cuts are relatively more stable but volumes are reduced compared with the same period last year and prices have also been disrupted. Once the current liquidation of cow numbers due to ongoing drought has run its course, we expect the U.S outlook to be positive.
At some point during Q1 2023 if feed conditions change as per forecasts, there will be significantly less cow kill, resulting in less domestic lean trim available, which will result in increased demand for lean imported beef, which will drive a lift in pricing in the U.S and across Asia.
Meanwhile, China is also presenting some challenges with demand continuing to be affected by Covid lockdowns. We continue to work closely with our customers as they navigate the market slowdown. We are also actively diversifying volumes across other markets. Chilled demand remains active, with shipping frequency improving will assist with arrivals to market with good shelf life into the retail sector which has a growing demand.
European markets remain unchanged with all importers very cautious about forward purchases. The Australian beef kill is starting to lift which is creating some increased competition within Asian destinations such as Japan and Korea, but we are not forecasting a large volume increase until early 2023.