Eblex conference: Targeting growth

Optimising production

The world is changing fast, and with beef production declining and lamb consumption challenged by high prices, it is important to maximise efficiency all along the production chain. Eblex board member Richard Phelps pointed out the huge growth experienced by discount retailers Aldi and Lidl (16.2% and 12.6% respectively) shows that consumers remain price-sensitive. “Prices are high, but we cannot rely on that to make profits,” he said. “We need to improve consistency through the supply chain and focus on farm efficiency for better returns.”

Irish Farmers Journal livestock editor Justin McCarthy believes Ireland’s BETTER Farm programme, which aims to improve profitability by applying research recommendations to the farming system, is the example to follow. “By changing grass land management, we have increased BETTER farms’ beef production by 32% over three years, and seen a 120% rise in gross margin,” he said.

In order to optimise carcase value, Eblex has been promoting new beef and lamb cuts suitable for sous-vide cooking, allowing wholesalers and retailers to sell less popular parts of the animal. The organisation also helps farmers identify the perfect time to send a beast to slaughter with the ‘Better returns’ training programme.

Beef and lamb processors should also consider the value of offal in the export market, and not just in Asia. Rémi Fourrier, who manages the French office of Eblex, said that sliced lamb kidney can be sold for up to €18/kg in French supermarkets. “France offers fantastic opportunities for offal, which is why we have created the European Union of Variety Meats to promote fifth-quarter cuts,” he added.

International expansion

Cross attributed the industry’s success this year to the opening of major export markets, such as China and Russia. “Since August 2010, we’ve been instrumental in opening 37 additional non-EU markets around the world. More exports markets means more demand on our part and also gives us outlets for traditionally under-used parts of the animal, aiding carcase balance, and turning what used to be costs into potential added-value products,” he said.

The export market now represents 20% of total beef production, and it is the perfect time for the UK to capitalise on the narrowing of prices. US beef production is declining, Russia is maintaining its partial import ban on Brazilian meat, and New Zealand lamb prices are going up as farmers increasingly switch to dairy, making the UK more and more competitive.

Eblex head of trade development Peter Hardwick explained that China and the Middle East are key to the growth in beef consumption as they become gradually more urbanised and benefit from higher disposable incomes. “The BRIC countries (Brazil, Russia, India and China) have growing populations, as well as economic development, which means bigger opportunities to sell meat into those markets,” he told delegates.

Focus on halal

However, Hardwick believes that despite China’s weight on the global meat market, it is not an easy market to break into. “There are currently more opportunities in the Middle East and Northern Africa,” he said. In these countries, space and weather conditions limit livestock production, and retailers rely mainly on imports to satisfy demand. However, they are traditionally Muslim, prompting the urge to develop the UK’s halal market.

Halal currently represents 25% of the country’s lamb consumption, and France, the biggest importer of UK meat, has the largest Muslim community in the EU. “They are major buyers of halal products, and we need to take full advantage of that,” Hardwick added. Fourrier’s team have recently developed a logo to make British halal lamb more recognisable for French consumers, and participated for the first time in Paris’ growing ‘Halal Expo’ this year.

The conference concluded that beef and lamb prospects for 2012 are optimistic, but farmers and processors cannot be complacent. Maximising farm efficiency, penetrating new exports markets and developing halal production will be the keys to a successful and buoyant industry.

> Video: Eblex conference 2011, a world of opportunities

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