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Beef lovers are facing a less merry Christmas as it’s unlikely that beef prices will drop before the start of the festive season.
This, according to Nkhensani Mashimbyi, agricultural economist of Absa Agribusiness, speaking to Plaas Media during the launch of the Spring edition of the Absa AgriTrends report at NAMPO Cape. “All meat prices have increased due to biosecurity concerns and disease outbreaks such as foot-and-mouth disease (FMD). While prices might correct for some of these industries, beef prices are set to remain high going into the festive season,” Mashimbyi said, explaining that demand was continuing to drive prices upwards.
Mashimbyi highlighted that robust biosecurity systems, effective disease surveillance, and coordinated response mechanisms are critical to safeguard South Africa’s livestock sector from transboundary animal diseases.
FMD outbreaks weigh on exports
The report warns that repeated outbreaks of FMD continue to undermine export growth, particularly in the beef industry. South Africa became a net beef exporter after achieving FMD-free status more than a decade ago. However, the loss of this status in 2019, followed by subsequent outbreaks, has repeatedly triggered export bans and eroded market potential.
Exports as a buffer against weak local demand
Exports have played a vital role in stabilising the industry, serving as a hedge against sluggish domestic demand, high interest rates, and rising living costs. While stronger consumer spending was expected to boost beef prices in 2024, dry conditions drove up slaughter numbers and capped price growth. International markets for premium boneless cuts remain key to optimising carcass value and managing risk.
Changing dynamics in beef prices
Mashimbyi said biological risks are reshaping the livestock sector. “Previously, FMD-related export bans pushed more beef into the local market, weighing on prices. More recently, the combination of a recovering consumer climate and reduced supply from FMD disruptions created short-term supply gaps that lifted carcass prices,” Mashimbyi explained.
Weaner calf prices also defied the usual trend of declining during outbreaks, thanks to sourcing strategies, tighter supplies, and favourable grazing conditions. Farmers are expected to hold back more weaners for backgrounding, further restricting near-term supply.
Gradual recovery, long-term outlook
Although slaughter numbers are improving due to strong industry responses, volumes remain below comfort levels. “Vaccination and traceability efforts are encouraging and could reopen the door to Chinese exports. As higher-grade cuts flow back into export markets, this will support sustained high prices, with beef unlikely to return to pre-FMD levels in the medium term,” Mashimbyi said.
Strategic role of the beef sector
The report emphasises that the beef industry remains strategically important for its contribution to grassland sustainability, integration with the grain value chain, and inclusivity. Strengthening animal health systems and improving traceability will be essential to retain and expand export opportunities, and to secure the sector’s long-term resilience. – Susan Marais, Plaas Media
