The Changing Face of the UK Beef Market
In 2023, the UK beef market experienced a slight dip, with volumes declining by 1% compared to the previous year, according to the Agriculture and Horticulture Development Board's (AHDB) annual beef outlook report. This decrease continues a trend seen since 2020, though forecasts for 2024 show a potential recovery of 1%. However, beef volumes will still remain 5% below pre-pandemic levels.
The primary cause of the reduction in beef demand can be attributed to the cost-of-living crisis, which has led to a decrease in purchases from both retail and takeaway outlets. Many consumers have had to tighten their belts, prioritising affordability. However, as people begin returning to restaurants and dining out more frequently, there have been some positive effects on the market.
Tom Price, a retail and consumer insight analyst at AHDB, anticipates an improving economic outlook for 2024. He predicts inflation will continue to ease, while wages are expected to rise. "Some shoppers will feel better off, but others may still face challenges and seek savings wherever possible," said Price. This gradual shift in consumer behaviour reflects the cautious optimism that remains amidst economic uncertainty.
Cheaper Cuts on the Rise
With household budgets under pressure, cheaper beef cuts, particularly mince, are becoming more popular among shoppers. Mince and other primary cuts are seen as more versatile and economical, especially as consumers increasingly turn to home cooking. Promotions and campaigns focused on events like summer barbecues could also help boost sales.
However, this trend towards cheaper cuts creates challenges for farmers, as the demand for items like mince and burgers can lead to carcass balance issues, devaluing the overall product. Despite these difficulties, the report suggests that beef could still enjoy a strong performance during key periods, such as Christmas, when consumers are likely to indulge more.
Pressures in the Dining and Takeaway Markets
Dining out, which faced a sluggish start in the first half of 2024 due to the ongoing cost-of-living crisis, is expected to pick up as the weather improves. On the other hand, takeaways are forecast to see a slight rise in volume compared to pre-pandemic levels, primarily driven by the affordability of burgers. However, the demand for more premium cuts like steaks is likely to continue declining.
As Christmas approaches, smaller gatherings and fewer office parties may further impact beef sales. Nonetheless, the takeaway sector could see a boost, particularly in more affordable items like burgers.
Recommendations for the Industry
To stimulate demand, the AHDB recommends promoting affordable yet flavourful beef dishes, such as batch-cooked meals and versatile, value-for-money options. For premium cuts, the focus should shift to capturing occasions traditionally served by more expensive proteins, encouraging consumers to treat themselves at home with restaurant-quality meals. Clear messaging on the nutritional benefits of beef, as well as a focus on animal welfare and environmental stewardship, could also help maintain consumer trust in the long term.