Market Study Quantifies Farm Assured Beef Value
02/11/05

Farm assurance is earning beef producers selling through English auction markets an average of 6.68p/kg, over £38/animal and more than £8.5 million/year overall, reveals the first-ever national assessment of the commercial value of farm assured beef.

Involving all English auction markets reporting price information to MLC, the English Beef and Lamb Executive (EBLEX) study analysed the throughputs of and prices realised by all farm assured and non-farm assured prime cattle sold between January and August 2005.

For the first time ever, this has enabled firm figures to be placed on the uptake and financial value of farm assured English beef. It has also highlighted the way differentials vary between  classes of stock as well as parts of the country; and provided the basis for daily reporting of farm assured and non-farm assured stock values from each market at www.eblex.org.uk

Some 79% of the steers, heifers and bulls sold for slaughter through the
90-plus markets reporting prices to MLC were farm assured. On average, these cattle earned a 6.68p/kg differential over the 21% sold as non-farm assured. At an average liveweight of 575 kg, this represents a differential of £38.41/animal.

Across all finished cattle sold through auction markets in England, the differential recorded is calculated to be worth more than £8.5 million annually, with producers of non-farm assured animals losing over £2.2 million in potential returns.

The EBLEX study shows steers realising the highest differentials for farm assurance at an average of 7.8p/kg, with heifers earning 6.9p/kg and bulls a relatively disappointing 3.6p/kg.

Although all parts of the country showed an average cattle differential for farm assurance of at least 5p/kg, the Eastern region, where only just over 60% of the cattle sold were farm assured, enjoyed the highest differentials at over 9p/kg.

Price Differentials for Farm Assured Stock in English Auction Markets (Jan-Aug 2005)

Based on an average cost for farm assurance of £73/unit, these figures show a clear cost:benefit from farm assurance for all English businesses selling more than two cattle for slaughter each year.