Reports indicate that it has been a quiet on the South African Futures Exchange (Safex) beef market, and that it could end on the same note. There is not much participation in this market and prices have been fairly flat around R41,50/kg throughout the week, with no volumes traded. “Against this background, it is worth noting that physical prices could differ from the Safex beef prices,” says Wandile Sihlobo, economist at Agbiz.
According to the Red Meat Abattoir Association (RMAA), cattle slaughtering was at 231 668 cattle in the week ending May 2016, down by 2% from the previous month. Lower slaughter numbers will be supportive of domestic beef prices. “We are of the opinion that in the short to medium term, South Africa’s cattle slaughtering pace could continue to decline, especially around spring when the grazing fields recover and farmers start rebuilding their herds.” – Agbiz