UK sheep sector was still profitable in 2020 even in the face of a pandemic

The value of UK sheep meat exports increased by almost 10 percent last year despite the difficulties brought about by the Covid-19 pandemic.

 

Newly released data for 2020 has revealed a profitable year for the sector against the backdrop of reduced volume of exports and changing consumer patterns.

HMRC’s figures show the value of exports increased by nearly 10%, while the total volume amounted to 88,200 tonnes, a drop of 7.2% (or 6,850 tonnes) since 2019, which was a strong year for exports.

The main driver in the dip in sheep meat exports from the UK was a cutback of 10.4% in shipments to France, the UK’s largest overseas market

If compared against 2018 totals, both volume and value of sheep meat exports in 2020 were considerably higher, up 19.1% and 6.1% respectively.

The amount of sheep meat imported into the UK fell last year, figures show, by 6.6 percent to total 58,500 tonnes.

Contributory factors to the changes in meat movement include the impact of the pandemic and an overall 3.7% decrease in sheep meat production in the UK.

These factors sit alongside post-Brexit uncertainty and global issues such as the African swine fever crisis in Asia.

A shift in demand also led to decreased exports of beef: the total volume exported was down by 13.8%, however, the value also dipped by 17.3%.

Hybu Cig Cymru – Meat Promotion Wales (HCC) said the Covid-19 pandemic caused considerable disruption for trade in 2020.

However, demand from some emerging markets and into countries where product is sold mostly into retail, did not decline.

Glesni Phillips, data analyst at HCC, said: “Export volumes to the Middle East increased by 18.3% whilst value also shot up by 37.4%, with Welsh processors leading the way.

“There was also an increase of 27.7% in volume sent to Italy (an additional 1,150 tonnes), again with Welsh Lamb securing important new business in the retail sector.”

Ms Phillips explained that import levels were also subdued as a result of factors at home and abroad.

“Imports are often highest during the first half of the year due to the nature of sheep meat availability in the UK. In 2020, this coincided with the start of the pandemic.

“New Zealand is the main importer of sheep meat into our country and a 2.4% decrease in shipments was partly due to the overall decline due to drought conditions which limited their supply

“This was coupled with an ongoing increase in demand for meat from Asia following the African Swine Fever which diverted some New Zealand sheep meat away from the UK.”

The overall decrease in beef exports can be attributed to Covid-19 disrupting trade flows despite a 1.9% rise in beef production in the UK during the period.

Beef prices have also been relatively high in the UK which made exports less competitive.

There were fewer imports of beef from Ireland, the Netherlands and Poland during the year resulting in an overall reduction of 3.3%, whilst value was also down by 2.9%.

“2020 was unprecedented for all industries and the red meat sector was no exception,” explained Ms Phillips.

“But the unequivocal support of customers in the UK ensured a constant retail demand for red meat.”

Exporters step back from markets due to border chaos

Auction markets were expecting to feel the impact of border closures at sheep sales this week as demand drops for export weight lambs.

On Sunday (December 20), France shut its border with the UK for 48 hours, meaning no lorries or ferries will sail from the port of Dover.

Ted Ogden, auctioneer at Skipton, said there would be demand for lambs to serve the domestic market but several export focused companies had told them they would no longer require the class of lamb for export.

“We still require sheep. The sales are still going ahead,” he said.

“But people need to know that their expectations may need to change and make their own decisions. Informing them is part of our job as auctioneers. If buyers are wanting more of those lambs we tell them so it seemed right we communicate this.”

 

 

by Alex Black

 

 

China trade bans spread to big lamb exporters

Chinese trade sanctions have spread to lamb with two of Australia’s biggest exporters effectively banned from the industry’s biggest market.

China is refusing to accept sheep meat from Australian Lamb Company and JBS Brooklyn after they were closed for short periods because of COVID-19 outbreaks.

The lamb and sheepmeat trade with China – worth almost $780 million in 2019-20 – joins beef, barley, wine, seafood, timber and coal on the growing list of Australian commodities targeted as relations between Beijing and the Morrison government continue to deteriorate.

Those relations hit a low last week when a senior Chinese official circulated a doctored image of an Australian soldier slitting the throat of an Afghan boy holding a lamb.

The Australian Lamb Company, which employs about 600 people at Colac, and the JBS Brooklyn plant near Port Melbourne have been reopened for months with no infections but remain shut out of China.

China has not imposed import sanctions on United States abattoirs hit by COVID-19 and is reopening to abattoirs in countries such as Brazil and Argentina which have high rates of infection.

 

 

by Brad Thompson

Brexit: Lambs to the slaughter

  • Brexit talks have been passed back to negotiators, with little sign of progress from the UK and EU leadership, and with no deal getting worryingly close for exporters.
  • Sheep meat is one sector facing particularly high tariffs – put there to protect British and other European farmers, but now the UK will be outside the EU fortress.
  • Even with a tariff-free deal, there will be high extra costs for animal produce going to Europe, involving certification, queues and border checks.

Remember spring? If you were lucky enough to get out to somewhere rural, you probably saw some cute lambs a-gambolling.

Well, it’s not looking good for them now. They’ve put on some weight, and are less cute. Or they were. This has been the slaughtering season.

About a third of Scottish lamb goes for export, and 98% of that is to the European Union. French chefs highly value uplands-grazed lamb.

There’s a metaphor somewhere in there for the Brexit talks.

But for sheep farmers, this isn’t metaphor. This is their future. The average tariff on sheep meat is 48%. It is not a flat rate: instead, there’s a fee per kilo and a percentage of the value.

And the more it is butchered and processed, the higher the tariff on entering the European Union.

by Douglas Fraser