Livestock producers are being offered a guaranteed minimum price for cattle following the UK launch of the world’s first smart, data-driven beef contract.
Unveiled by livestock management company Breedr, the long-term contract sets a secure price 24 months ahead. Farmers get the benefit if prices rise in the meantime – but there is no penalty if the price falls.
Breedr says the contract will give producers confidence to invest – and help to improve efficiencies throughout the supply chain. It says this will improve the consistency and quality of the end product, while reducing the sector’s carbon footprint.
The company has launched a risk-free way to buy and sell livestock, based on lifetime animal data and weights. The Breedr live trading platform means producers can buy and sell through the free app with certainty.
A price guarantee provides certainty in case there is any differential in the weight of weaned calves and stores between farms. Sellers are also ensured payment within 72 hours of collection. Trades will remain commission-free until later this year.
“As beef producers ourselves, we know how tricky it is to plan ahead with confidence – one batch of bad calves can ruin a farm, as can a downturn in the beef market,” says Breedr founder Ian Wheal.
“But by making better use of data we can buy and sell with transparency, predict growth rates, and know that we’re supplying the processor with what they want – ensuring a secure end market and price.”
The contract is worth more than £130m to British beef producers over the next seven years, says Breedr. It offers a 24-month minimum price for any cattle with lifetime data, with producers receiving a proportion of any uplift in price above that.
Rearers can opt to be paid per kilogramme of growth – eliminating the need for capital outlay on youngstock. Advanced payments are available to smooth cash flow and reduce uncertainty, says Mr Wheal.
“British agriculture is innovating to meet UK and global needs. Being able to plan ahead with certainty finally gives farmers the peace of mind they need to invest and build profitable businesses.”
Farmers using the free app are finishing animals five months earlier than the industry average, with 24% more carcases reaching target specification. Farmers using Breedr are saving 1.8t/head in feed and reducing their carbon footprint by 20%.
AHDB Beef and Lamb chairman Adam Quinney says the innovation is a boost for farm productivity. “We are very supportive of technology that is helping bring certainty, and collaboration between farmer groups in the supply chain.”
The network now has over 2,000 members and 120,000 registered animals across the UK. Mr Wheal says many users are joining forces to create integrated supply chains to further improve efficiencies.
By collating data on genetics, growth rates, health, and carcass grades, producers can identify the most productive breeding lines and management methods, optimising productivity throughout the supply chain.
Mr Wheal says: “This is a true community of forward-thinking farmers, who are sharing their own top tips and forming robust business partnerships. Together, farmers have the power to drive this positive change.”