In its Agri Market Outlook for 2022 it reported that overall beef consumption decreased by 4% in 2021 compared to the previous year. This was largely due to a return to more ‘normal’ buying behaviour following the huge increase in sales in 2020 alongside ongoing Covid-related difficulties in the food service sector throughout 2021.
Demand for beef in takeaway meals continued to increase and was up by 40% in 2021 representing 87% growth since 2019. But this was not enough to balance the losses from eating out and the retail sector, it says.
Meanwhile retail sales of lamb saw a small increase (1.9%) on 2019 levels which alongside a surge in interest in takeaways more than made up for the losses from the eating out market. Kebabs have been the main driver of takeaway growth accounting for 64% of volume in 2021, says AHDB.
Predictions for the beef sector in 2022 include a further small decline in retail sales, but recovery in food service from the second half of 2022. However food service is not expected to recover to pre-pandemic levels due to the increase in working from home and the ongoing squeeze on household budgets which will affect all red meat consumption. AHDB expects overall beef consumption to be 1% lower in 2022 compared to 2021.
Eating out and retail will also be a challenge for lamb but AHDB anticipated that the kebab market is likely to remain a stronghold with further growth opportunities. However with kebabs less likely to contain British lamb this was also a challenge, it says. Overall AHDB expects total lamb volumes to fall by 3% this year versus 2021 and slightly behind 2019.
Efforts to address consumer perceptions over red meat, build consumer trust, demonstrate farming values (animal welfare, environmental stewardship and expertise), innovate with new products and tap into seasonal opportunities could help mitigate challenges, the AHDB concludes.
Beef imports are expected to show slight growth (1%) while exports are predicted to increase by 10% in 2022. Global supplies are forecast to remain tight which, together with reduced production from North America, New Zealand and the EU, is expected to have a positive effect on price.
With demand remaining solid and tight availability for lambs, AHDB expects the buoyant market to continue in 2022. Prices are likely to remain strong although may not reach the highs of 2021. Increasing input costs will however affect profitability, it warns.