Beef and mutton prices may keep rising until Spring Festival

    "The price of beef at 28 yuan per jin has stayed that way for more than a month, and the price of mutton has risen to 40 yuan per jin. Prices are high this year, and business is not easy either." Early on the 8th, the meat vendor Old Ma stood in front of his beef and mutton stall in the vegetable market of Shunyu Residential Area in Jinan, China, turning over the meat on the counter and removing some of the less attractive pieces by hand.

    Here come the "Bull Demon King" and "Consort Yang"

    People passing by occasionally stopped to ask Old Ma about prices, then hurried off again. Looking again at his own counter, not much beef or mutton had been sold. Less than 5 m away, the pork stall was crowded with people making selections, and the several rows of racks in front of the shop were already fully hung with stuffed sausages.

    "I sold less than 10 jin of meat all morning." Old Ma told the Economic Herald reporter that beef and mutton prices had continued to rise this year, and sales had also been affected considerably. Previously he could sell one cow and two sheep in a morning; now he could barely sell one cow and two sheep in a day. According to Old Ma, the price of beef had basically remained at 28 yuan per jin for the past month, while the price of mutton had risen from 35 yuan per jin a month earlier to 40 yuan per jin now.

    Compared with farmers' markets, consumers feel the price changes of beef and mutton sold in supermarkets even more clearly. At a large supermarket on Yingxiongshan Road, the highest price of beef had risen to 48 yuan per jin, while the price of mutton had broken through 50 yuan per jin. "I spent 24 yuan on half a jin of ground beef, which is only enough to make one batch of dumplings." Resident Aunt Zhou lamented the high price of beef to the Herald reporter.

⟧NL⟧    According to monitoring by the Shandong Provincial Animal Husbandry Bureau, with the help of the holiday effect of New Year's Day, beef and mutton prices in our province continued to lead the rise last week (December 30, 2012 to January 5, 2013, the same below), climbing to new highs again. Last week, the price of beef in our province was 50.76 yuan/kg, up 27.57% year on year and up 1.70% month on month; the price of mutton was 63.51 yuan/kg, up 28.51% year on year and up 0.54% month on month.

    In fact, not only in Jinan, China; since the second half of last year, beef and mutton prices across the country have risen substantially. Consumers everywhere exclaimed that the "Bull Demon King" and "Consort Yang" had arrived. Since April last year, national beef prices had shown an obvious upward trend, and after a brief period of stability in October, the upward trend reappeared in November. Compared with April 1 last year, on January 7 this year, the prices of beef shank and beef brisket nationwide rose by 28.2% and 30.6% respectively.

    Decline in inventories

    "Reasons such as large investment, slow speed and long cycles have led to a decline in beef cattle breeding inventories, ultimately causing an imbalance between supply and demand." Song Xihai, president of the Laizhou Beef Cattle Association, said in an interview with the Herald reporter on the 8th.

    According to Song Xihai, buying a calf now costs 5,000 to 6,000 yuan, and a cow's growth cycle is as long as 3 and a half years. Adding feed input, a total of 12,000 yuan needs to be invested, and by the time it is sold at slaughter, the profit on one cow is only 1,000 yuan. Labor costs are also rising rapidly. Income from working in the Qingdao, China area is about 2,500 yuan per month. Hiring a cattle herder costs 140-150 yuan per day, more than 3,000 yuan per month. Low profit and large investment are the main reasons for the continuous decline in beef cattle breeding inventories.

    "Prices are high this year, beef is in short supply, and profit can reach about 1,800 yuan per head." Song Xihai told the Herald reporter that since the beginning of this year, the price of live cattle had risen from 12 yuan/jin at the beginning of the year to 13.5 yuan/jin.

    Hu Zhisheng, an analyst at the Shandong Provincial Animal Husbandry Information Center, said in an interview with the Herald reporter that beef and mutton prices had both turned upward and higher, and the contradiction between market supply and demand remained the bottom-line support for the trend of beef and mutton prices. In addition, with Spring Festival approaching, market demand was becoming increasingly brisk, which further pushed prices to climb again and again.

    According to Hu Zhisheng, the rigid demand for beef and mutton is still increasing, beef supply is gradually decreasing, and in particular the production capacity for high-grade beef and mutton is insufficient, so the growth of supply cannot keep up with the surge in demand.

    "The deep-seated reason for the rise in beef and mutton prices is that beef and mutton production in our country is mostly household free-range farming, and the degree of large-scale breeding is not high." Hu Zhisheng said that in recent years, in Jining, Qingdao, southwestern Shandong and other places, small-scale breeding households had continued to withdraw, fewer and fewer households were raising cattle, and large-scale farms also faced huge pressure. The cattle inventory in our province had decreased year by year, causing a certain shortage in market supply. According to statistics, in 2000 the cattle inventory in our province was 7.8 million head and the sheep inventory was 22.6 million head, while by 2011 the cattle inventory was 493 head and the sheep inventory was 21.5 million head, decreases of 36.8% and 4.8% respectively. In addition, cattle and sheep have long breeding cycles. A sow can reproduce 7-8 head a year, while a cow or ewe reproduces on average 1.3 head a year, so expanding the scale of cattle and sheep production relatively speaking takes a very long time.