UK beef prices are set to remain high for the foreseeable future as the double whammy of falling production in South America and tightening European supplies hits home.

EU countries have found it harder to source beef from South America this year, said AHDB's international manager Peter Hardwick.

Having imported 556,000 tonnes of beef in 2007, mostly from South America, the EU only imported 390,000 tonnes in 2008 and this fell another 10% in the first three months of this year.

Argentina - which has the world's largest beef consumption per capita - is actually set to become a net importer of beef next year following a nosedive in production sparked by drought and internal politics.

Meanwhile, Brazilian beef export restrictions to the EU mean only about 2,000 farms will be cleared to supply the union by the end of 2009, down from 7,000 in December 2007.

Farmers in both countries have also been leaving cattle farming and switching to soya production.

The average price of an own-label 450g-550g sirloin steak in the big four has risen 3% to £14.71/kg in the last year, The Grocer pricing index shows.

Retail prices were not likely to fall in the near future, added Hardwick. "We're in a market short of beef so price will reflect what the market's prepared to pay. We need food security in the EU. World supply's tight, and our production's fallen. We can't assume non EU countries will be a food source for us in the future," he said.

The UK imported 247,000 tonnes of beef last year.