China’s ‘freedom to eat beef’ belies farmers’ mood of udder chaos as cash cow hits tipping point
- Beef prices are down sharply in the past year, hitting the agriculture industry hard but giving consumers’ wallets a break
Beef prices are trending downward in China as the nation’s most expensive livestock meat finds itself sandwiched between a double whammy of oversupply and weak demand – a trend likely to continue for the rest of the year, according to analysts.
Despite beef’s smaller weighting versus pork in the consumer price index (CPI), the falling price does not bode well for China’s efforts to tackle persistent deflationary pressure. The National Bureau of Statistics (NBS) is set to announce May’s CPI today.
The average wholesale price of beef was 61.20 yuan (US$8.45) per kilogram as of last week, down 14.5 per cent from the beginning of the year and a 17.4 per cent decline from the same period last year, according to the price report released by the Ministry of Agriculture and Rural Affairs of China.
The market retail price of boneless beef in April was 72.58 yuan (US$10) per kilogram, a 14 per cent year-on-year decrease, according to the NBS.
On the supply front, an incoming surge in cheaper beef from overseas, large inventories, and an increased slaughter of milk cows as a result of milk-price declines have all contributed to the oversupply, said Wang Chen, senior analyst for the Bric Agriculture Group’s database, a leading big-data resource covering China’s agriculture and food sectors.
“Last year, China’s combined domestic-plus-imported beef supply reached 10.26 million tonnes, breaking the 10 million tonne benchmark for the first time, hitting a new record,” according to He Zhonghua, an analyst with the China Meat Association, which operates a comprehensive agricultural industry website.
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