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Profit in red meat if you stick to quality markets
There is a growing and sustainable demand for English meat and producers can profit from it by concentrating on the quality end of the market, ensuring their levy funds go to support those sales and stop trying to compete for "value" and discounted sales.
Delivering the RASE Annual Lecture, Norman Bagley, Policy Director for The Association of Independent Meat Suppliers, was up-beat about the future for quality production but listed factors which were unhelpful to developing sales of English red meat.
"Store wars, where supermarkets vie with each other to cut the cost of English quality meat, that is in such short supply that it should be earning a premium, is a very unhelpful trend.
"Similarly, raising the cost of meat inspection through the Meat Hygiene Service is counter productive. We have an MHS that currently costs £90m plus a year to run that we believe could be delivered for not much more than half that amount and so why expect industry to foot the bill for the inefficient, too costly service?
"Given reasonable trading and operating conditions, the small abattoir sector has a vital role to play. It is a vital part in the chain that delivers quality, locally-sourced, English provenance meat to retail butchers, food service, ethnic customers and the supermarket sector. The sector has survived past threats to its existence and now it must be encouraged to play its part in helping the English red meat industry - from farmer to consumers - survive and thrive."
Mr Bagley, who was also winner of the 2007 National Agricultural Award presented by RASE, said that there was plenty of evidence that consumers wanted English meat. Beef, pork and lamb sales were all increasing in both volume and value, so the industry had to get behind the potential success story. But there were real threats on the horizon.
"Economics may well force beef production to drop significantly. If this happens, slaughter capacity in the beef sector will be taken out at the large end as has happened in the pig industry. Perversely this leaves a greater proportion of what remains available to small abattoirs.
"Producers have a future if they realise that trying to compete with imported products on the commodity shelves is something they cannot possibly do in the face of store wars and discount pricing. They must aim instead at getting a bigger proportion up into higher value, quality based brands and standard ranges whether through supermarkets or the independent sector.
"The sheep industry may also contract but I also think they have a far more powerful tool than beef with which to get a more realistic return and that is to make common cause in the market place with the New Zealanders and therefore maximise profit in season. They must also get Government and others to recognise the environmental value of sheep and recognise also the opportunity it provides to establish a more natural form of fertility. With high costs of crude oil fertiliser this is an issue not to be sneered at.
"The pig industry is also contracting further and has reached a point of questionable critical mass and dominance by just a few Dutch and Danish companies. Again a greater concentration in quality based brands and standard ranges seems to offer the best way forward especially as switching to imported products is so easy for them.
"Honest and transparent country of origin labelling on all products not just fresh produce is surely long overdue".
Mr Bagley said he was encouraged that major retailers were turning to many more small abattoirs to deliver the solutions to demand for local and regional products. This is a positive sign that central distribution is perhaps not the only way forward.
"But nor can the importance of exports be underestimated as a competitive force for good and with world wide demand for red meat growing it is vital that these opportunities are maximised. Proportionate use of levy payers' funds to support exports must not be lost in the present debate about the general future of EBLEX. Their work over the last few years has been invaluable. Market share measurements prove inconclusively that the French market is equally important to the English lamb producer as is the supermarket sector," he said.
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