Meat prices hit menus
Lynx Purchasing Market Forecast looks at the spring trends as beef and lamb prices rise, making pork better value
Beef will become more expensive as the impact of declining cattle numbers worldwide works its way through the supply chain, according to buying specialist Lynx Purchasing.
Along with the prime cuts needed for steaks and Sunday roasts, the impact of higher beef prices is also hitting the offcuts and trim used in menu
mainstays such as pies and burgers.
In response, Lynx is advising caterers to make the most of a generally favourable food market and make full use of produce such as British pork and fresh fish, which currently offer better value.
The challenge of rising beef prices is highlighted in the newly-published Spring 2015 edition of the Lynx Purchasing Market Forecast. Along with
a fall in cattle numbers in the UK, similar declines are being experienced around the world.
The main cause is the increasing challenge cattle farmers face in making a profit. Lynx managing director John Pinder says: "As often happens,
caterers are getting the blunt end of the price pressure that major supermarkets put on suppliers, which is an international issue rather than simply being confined to the UK market. The normal effect of rising demand is for supply to increase to meet it, but in the face of retailers' continued
insistence that suppliers maintain low prices, there's little incentive for farmers to increase beef production."
Pinder continues: "For the most part, customers in restaurants and pubs expect beef to occupy the premium slot at the top of the menu pyramid,
and will pay a premium so long as their steak or Sunday roast delivers the ‘wow' factor. However, if beef becomes too pricey on menus, for many customers it won't just be a question of trading down to cheaper dishes; they may not eat out at all.
"When it comes to dishes such as a gourmet burger or a steak and ale pie, the price point differs according to the style of the operation, but they have to represent value for money on those terms.
"As always, there are actions that operators can take to mitigate the challenge of higher beef prices, at least in the shorter term. As well as working
closely with suppliers to buy seasonally, and keeping menus flexible to use the best-priced beef cuts, caterers should be looking to spotlight alternatives to beef."
The Market Forecast has highlighted the produce that will be good value for caterers over the coming months.
Although demand continues to be strong as the popularity of authentic barbecue dishes continues, the Russian ban on EU pig imports in response to sanctions has driven domestic prices down.
"Alongside higher beef prices, lamb hits its peak price in the spring, so making a feature of pork on the menu is likely to be an appealing option for both caterers and their customers. A British pork joint as an Easter roast, or seasoned British pork burgers, can be popular menu choices," says Pinder.
Flat fish species are great quality during the spring months, with good availability and pricing. These include brill, dab, Dover sole, megrim and witch. Lobster and crab from British waters will also be good value.
UK and European potato crops were strong last year and supplies are lasting well, and there are also plenty of good quality carrots and parsnips
around. Savoy and green cabbages are also in good condition.
"Descriptions such as ‘served with fresh, seasonal vegetables' allow operators to change the mix according to availability, and get maximum value from what has been a very good year for fruit and veg," says Pinder.
Areas of concern
Although the overall supply picture is good, there are inevitably some areas of concern identified in the Market Forecast.
This is currently a volatile market, with suppliers asking higher prices than usual. Yields in Italy have been geographically very variable and lower than expected.
Free range dairy and eggs
Demand for free range dairy has soared, buoyed by increased consumer preference. Free-range eggs are also in high demand, affecting prices.
Supply continues to be restricted as a result of the early mortality syndrome virus, which has caused problems for warm water prawns. In turn, cold
water prawns have been affected as demand increases. A reduction in global quotas has added to the supply problem.
"Weather remains the greatest area of uncertainty," says Pinder. "For example, coffee crops in Brazil were affected by a long dry spell until very recently, when the rain came and commodity prices tumbled. Elsewhere, storms have impacted banana shipments from Costa Rica, pushing the price up."
Ups and downs
Lynx Purchasing's Market Forecast combines exclusive insight from many of the food and drink suppliers that Lynx works with, along with official inflation data from the Office for National Statistics.
The headline Consumer Prices Index showed that prices grew by just 0.3% in the year to January 2015, compared with 0.5% in December 2014. Caterers are not benefiting to the same extent as consumers from falling oil and food prices, not only because supermarkets are competing for customer spend with big discounts, but also because higher driver costs are offsetting much of the advantage of lower fuel costs for wholesalers.
Free GP Calculator app
Lynx Purchasing offers a free, no-contract service that enables businesses to buy the highest quality products and services at the most competitive prices.
Lynx's effective and experienced team of purchasing experts help hospitality and catering businesses buy better, manage their costs and operate more profitably. Lynx works with a wide range of catering businesses, including hotels, restaurants, pubs, care homes and the education sector.
Lynx's free GP Calculator app will let you set the correct pricing on your menus. To download the app, which is endorsed by the Craft Guild
of Chefs, search for GP Calculator in the iTunes store or on GooglePlay.
You can keep up to date with Lynx Purchasing on Twitter @lynxpurchasing
Working with Lynx could start saving your business money straight away. For more information call 01937 591088, email savings@lynxpurchasing,co.uk or visit www.lynxpurchasing.co.uk.