New opportunities for beef suppliers
Beef consumption habits have changed during the global Covid-19 pandemic but some markets are expected to recover faster than others and, despite the fact that consumers are going to resume their old habits, new opportunities are emerging for "those stakeholders in the supply chain that have gained through this period to hang on to new consumers and ‘lock-in’ new consumption habits", according to the latest Rabobank analysis.
While total beef consumption has not seen too much change, we have seen distribution channels change, benefiting some at the expense of others. As the impacts of ASF are overcome and disruptions from Covid-19 subside, old distribution channels will recover. “It is likely that many consumers will revert to their previous habits, but we do see opportunities for those stakeholders in the supply chain that have gained through this period to hang on to new consumers and ‘lock-in’ new consumption habits,” said to Angus Gidley-Baird, Senior Analyst – Animal Protein.
Due to restrictions imposed in several markets, as a Covid-19 second wave is hitting regions such as the US and Europe, beef consumption may drop. However, recovery is expected in markets such as Canada, Brazil and China. "Outside of a few isolated Covid-19-related challenges, Canadian beef processors have resumed normal operations. Canada’s fed cattle backlog has been slower to clear than the US. As of 1 October, cattle on feed greater than 150 days was 31% higher than in 2019.
While Covid-19 is largely under control in mainland China, cases of imported frozen meat and seafood affected by the virus have been continuously reported. This will lead to stricter inspection at ports and local cold chain/storage, which will likely slow down imports.
In Brazil, the number of new cases has been falling since the end of July. The foodservice channel is operating with reduced capacity. The arrival of warmer weather limits the spread of the virus, but the risks of rising new cases increase with the proximity of the holiday season," mentioned the report.
In the European market, A second ‘lockdown’ is now underway, with out-of-home consumption restricted or closed in most countries. Consumption of beef and veal will decline accordingly, as increased retail sales have not compensated for losses in foodservice. It appears that these restrictions will last into 2021.
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