Global trading platform TridgeGlobal trading platform TridgeGlobal trading platform Tridge
Intelligence & Data
Sign In
Current Plan
Intelligence & Data Solution
Get started with Premium Plan of our Intelligence & Data Solution to get access to premium content and data in food and agriculture
Tridge analysis

Lower Cow Beef Prices in Europe Signaling Inflation Might Be Hampering Demand

Fresh Whole Beef
Meat
France
Market Situation
Germany
Price Trend
Jun 22, 2022
Written by
image
Rene Salinas
Share This Story
Cow beef prices in Europe declined for a second consecutive week, signaling demand could be waning as inflation hits consumers.

During the 23rd week of 2022, ending June 12, cow carcass prices in Europe declined for the second consecutive week, averaging EUR 4.40/kg among the seven largest cow beef producers: France, Germany, Italy, Poland, Netherlands, Spain, and Ireland. Prices had been continuously increasing in weekly terms since the last week of 2021 until week 21 of 2022.

The weekly decline was driven by prices in Germany (-3.4% WoW), Netherlands (-2.5% WoW), Italy (-1.5% WoW), and Poland (-1.2% WoW), more than offsetting gains in Spain (+2.6% WoW) and France (+0.4% WoW). Ireland's prices remained virtually unchanged in weekly terms (+0.0% WoW).

The decline can be explained by some slowing in demand in the region, as high prices seem to be affecting consumers to a point where they are starting to substitute beef as a protein source. Other factors contributing to the recent decline is that prices have finally reached a point where beef processing is profitable again, as costs had been increasing faster throughout the year. Moreover, some input prices for cattle feed have been easing in the recent weeks after peaking in mid-May.

Germany had the earliest recent price peak, which happened during week 13, followed by Italy, in week 16, and the Netherlands, during week 18. However, it's worth noting that prices haven't peaked yet in Ireland and France, where they reached during week 23 -the latest data- multi-year highs of EUR 4.72/kg and EUR 4.97/kg, respectively, although the aforementioned effect of inflation on consumers is exerting downward pressure as well as the week over week growth for prices in both countries is clearly slowing down.

Prices still remain considerably high compared to those in 2021. The average cow carcass price in the seven largest EU 27 producers is up by 46% YoY. Prices averaged EUR 3.02/kg in week 23 of 2021. Strong demand in the region and higher input prices, particularly after the Ukraine-Russia conflict started, have driven prices to their current levels. While there has been a clear decline/slowdown in the recent weeks, it is still early to call a general price peak in the region, as there’s still uncertainty about the outcome of the conflict and its ongoing effects on commodity prices. Moreover, beef production in Europe is expected to slightly decline in 2022, and a tighter market could mean higher prices ahead.


Source: Tridge and European Commission


Was this story helpful?
By clicking “Accept Cookies,” I agree to provide cookies for statistical and personalized preference purposes. To learn more about our cookies, please read our Privacy Policy.