Lack of transparency throughout beef supply chain 'affecting returns for all', warns AHDB

A more transparent environment is needed for the beef supply chain, warns AHDB
A more transparent environment is needed for the beef supply chain, warns AHDB

A lack of transparency throughout the British beef supply chain is affecting returns for all, according to the Agriculture and Horticulture Development Board (AHDB).

The AHDB said the industry needs to start to "work together better to deliver greater efficiency".

Summarising a series of analyses into current pricing of beef carcases, AHDB Beef & Lamb suggests the market isn’t currently working to the benefit of either producers or processors.

Producers are seeing a reduction in returns and processors are not getting the mix of carcases that their customers require, the organisation said.

AHDB undertook the analysis following reports of changes to pricing specifications by processors, however the resulting analysis found difficulties on both sides.

'Transparent environment'

Stephen Howarth, AHDB Market Intelligence Market Specialist Manager, said a "more transparent environment", allowing "more positive, open relationships" to develop across the supply chain, would "potentially benefit everyone."

"It would give producers more certainty about future market requirements, encouraging them to make the changes needed to deliver consistent carcases.

"In return, processors would get more certainty that they will be able to secure the supply they need. It would be a clear win-win for both groups of levy payers."

Specification range

The first stage of the analysis looked at the extent to which the prime cattle being delivered to processors meet their requirements.

The second looked at levels of penalties and the final instalment showed that prices paid for prime cattle are only partly related to meat yields.

The report found only half of the cattle slaughtered in the months analysed hit suggested specification range, and less than a quarter of male cattle hit both target classification and the narrowest weight range.

The fragmented nature of production is one factor preventing carcases being more consistent, the report understood.

Only relatively small adjustments to carcase classifications are needed for producers to significantly improve returns.