A shrinking national suckler herd is at long last bearing fruit for producers with soaring prices for store cattle and prime values that are slowly but surely heading north.

Latest figures from AHDB show the All Scottish steer average improved by 1.2p on the week to level at 506.1p while those hitting R4L 'spec were valued at 509.2p. Producers with regular lorry loads will be making quite a bit more per kg too.

The All Scottish heifer maintained the previous week's price at 506.2p with R4L carcases making an extra couple of pence, while young bulls jumped a massive 7.2p to average 482.3p.

Meanwhile, store cattle prices at the major centres have been averaging well above the 300p per kg mark with bullocks and heifers cashing in at 321p and 312p at Aberdeen and Northern Marts' recent sale. At United Auctions' last sale at Stirling, stots and heifers levelled at 309p and 299p respectively.

While consumers have moved to lower priced proteins as a result of higher retail prices, the good news is global demand for beef looks set to remain steady in 2024, according to the experts at Rabobank.

They pointed out that while consumers trended towards cheaper options in 2023, foodservice and retail companies began promoting value-based propositions more frequently, some of which outperformed.

Angus Gidley-Baird, senior analyst at Rabobank, said: “While there was some channel shifting and movement to lower-priced options for beef, overall demand held up relatively well in 2023, supporting consumption levels."

As one of the world's leading food and agribusiness banks, its most recent report said it expects GDP growth rates to slow and unemployment rates to rise in many countries in 2024.

Mr Gidley-Baird added: “Questions about economic performance, income levels, costs, and the direction of monetary policy remain unanswered, but we expect overall beef demand to hold in 2024 and, therefore, consumption levels to remain steady."

Despite the economic headwinds, the report states a neutral outlook for global beef production, with increases in Australia and Brazil offsetting declines in Europe and the US.

“Without strong demand pulling volume through the supply chain and bidding prices up, price setting falls back to the producer end of the chain and, with it, increased exposure to seasonal conditions and producer sentiment,” he said.

The strength of the economic outlook in different beef-consuming markets creates an interesting overlay to the global beef production situation and the balance of trade.

“With limited or negative real wage growth expected in 2024, coupled with the higher cost environment, we believe global beef consumption will at best remain steady and possibly decline through 2024, with some notable regional variations.”

As a result, he said there are important questions to be asked around margins and trade for those in the supply chain.

In a market where beef production growth is limited – the US for example – he said the consumer may be willing to tolerate higher prices at the expense of some consumption, i.e., maintaining demand.

On the other hand, in a market with growing supply – such as Australia – lower prices may be needed to encourage consumption.

China’s import demand should remain sluggish in 2024 – at least in the first half – and with demand strength and lower domestic supplies in the US market, beef trade is being diverted.

“Brazil’s exports to the US in January 2024 were ahead of 2023, and Australian volumes were up 127% YOY. If China’s recovery is better than expected, global beef markets could become quite tight, fuelling price rises,” Mr Gidley-Baird said.

Due to its reasonable economic outlook and lower domestic supplies, the US is likely to lead the beef price-setting market and draw increased volumes from Australia, New Zealand, Brazil, Canada, and Mexico.

“But value will become the predominant theme across most markets in order to retain consumers faced with balancing the tighter economic conditions,” explains Gidley-Baird.