Sheep and lamb processing: assessment
Research investigating the opportunities and challenges industry faces in retaining and increasing sheep and lamb processing in Scotland.
1. Scottish Agriculture College (SAC) consulting
2. Pareto Consulting
3. Pers. Comm. ScotEID, March 2019.
4. Sometimes called 'dressed weight' this represents the weight of the butchered animal, e.g. with internal organs and skin removed.
5. Pers. Comm.: RESAS and QMS, February 2019
6. Vivers is a separate registered company to Scotbeef but both are owned by JW Galloway Ltd.
7. Scotbeef took over Mathers (Inverurie) Ltd and former ANM Group Ltd's 'Scotch Premier' plants in 2012.
8. Irish Farmers Journal, July 2018
9. The number of lambs each year was adjusted by the following year's number of 'other sheep over a year for breeding' to represent ewe lambs retained for breeding stock.
10. In 1991 Scotland had 22.6% of UK sheep, falling to 19.5% in 2018. This reflects that the reduction in sheep production since the 1990s was not as large in England and Wales as in Scotland.
11. https://www.fwi.co.uk/news/major-scottish-abattoir-and-meat-plant-close and Pers Comm Brian Pack OBE, February 2019.
13. It was bought out of receivership from a Dutch company who had planned beef exports to EU prior to the BSE export ban.
15. QMS (2018) estimate 18% of Scottish slaughtered lamb
16. The New Zealand sheep industry is an obvious country to benchmark against. However, their industry is in long term decline. Indeed, the economic viability of their processing sector has been on ongoing problem since the 1980's and pathways to counter the forces of decline and improve their competitiveness is detailed in reports such as: (e.g., GHD NZ Ltd, 2104; MIE, 2015).
17. The KO% determines how much saleable carcase weight is obtained from the live animal.
18. Pers. Comm. Dr N. Clelland (SRUC), March 2019.
19. Oestrus in sheep is generally triggered by shortening daylight of autumn.
20. 16-20kg cwe with a limited fat covering (3L) and a conformation (shape) of R or better.
21. The 5th quarter is what remains of the lamb after the part sold for meat (carcase) is removed. It includes the pelt, organs (pluck), head, intestines, feet, etc.
22. Pers Comm. SAMW Ian Anderson (former Executive Manager) Scottish Association of Meat Wholesalers October 2017.
24. Also see GHD NZ Ltd (2014)
25. Published accounts
26. Though dated, Ferreira (2003) findings remain remarkably fresh and pertinent to today's situation here in Scotland. In that report, processor margins averaged 2.1%.
27. New Zealand's biggest processor Silver Fern Farms reported a 1% profit margin in 2018 from $2.4 billion turnover.
29. NB. only relates to fresh or frozen lamb purchased for home-cooking purposes
32. These estimates follow discussions with AHDB and QMS. Available data on catering-consumption do not separate lamb from other meats, making it impossible to derive definitive estimates. This leads directly to the first recommendation made in this report (see later), to improve the measurement of lamb consumption.
33. This conversion is approximate due to the presence of bones in some consumer products (e.g. chops) and adds to the difficulties in reconciling reported production and consumption totals.
34. NB. only relates to fresh or frozen lamb purchased for home-cooking purposes
35. NB. only relates to fresh or frozen lamb purchased for home-cooking purposes
36. AHDB are due to release a report on the UK halal market later in 2019.
37. Available at: http://beefandlamb.ahdb.org.uk/wp-content/uploads/2019/07/UK-Lamb-Trade-May-2019.xlsx Summary data are provided in Appendix 4.
38. Based on HMRC Trade Statistics (https://www.uktradeinfo.com)
39. Rest of the World
40. Proportional to product value
41. Using the 2018 average per kilogram value of sheepmeat cuts the 'effective tariff' is an implied overall tariff rate that expresses the value of total tariffs (ad valorem plus fixed rate tariffs) as a proportion of the 2018 average product value traded with the EU. It is dependent on the exchange rate due to the fixed rate tariff.
42. The economics of the red meat industry (2015). Griffith.
43. For example: Muslims of north African and middle eastern origin tend to favour lamb, whilst those form Bangladesh, Pakistan and India tend to favour mutton. Therefore French and German Muslims have higher demand for lamb compared to the UK Muslim population where demand for mutton remains high (pers comm. Rizvan Khalid - Euro Quality Lamb - June 2019).
44. One processor estimated that 15% of the UK halal market demanded non-stun product (pers comm. Rizvan Khalid - Euro Quality Lamb - June 2019)..
47. See https://www.mla.com.au/prices-markets/market-news/archived/2018/chinas-sheep-cycle-driving-global-markets/ for China's import share.
48. The tendency in any multistage process for production orders received by each upstream process to be more erratic than actual production or sales at the next downstream process.
49. NZ Farmers Weekly, 19/5/19 edition.
51. The press play a major role in influencing attitudes towards halal slaughter, with some negative views promoted. For example: https://www.express.co.uk/news/uk/934454/bbc-countryfile-halal-meat-slaughter-islam-muslims
52. Demonstration of Scott Technology. https://www.youtube.com/watch?v=KhZ2jl-exBs
53. The EUROP system grade on fatness (from too lean 2, 3L, 3H to 4 overfat) and conformation (EUROP with E at the most shapely/muscular end of the scale). The preferred "supermarket spec" is generally at least R3L in the 16-20kg cwe weight band.
54. Vivers have simplified the EUROP system into one of three grades (one = best) based on fatness, conformation and carcase weight.
55. To achieve a 60% yield requires an extremely well-muscled breed like a Texel.
56. New Zealand sheep are notably easier lambed because of their body shape than British sheep, allowing for far bigger flocks, thereby lowering their cost of production.
59. Carcase trait phenotype feedback for genomic selection in sheep. BB/P005098/1 https://gtr.ukri.org/projects?ref=BB%2FP005098%2F1
60. Building resilience into Scotland's lamb supply chain. Farm Stock (Scotland) Ltd, SRUC, SAOS and Scotbeef Ltd. https://ec.europa.eu/eip/agriculture/en/find-connect/projects/building-resilience-scotlands-lamb-supply-chains
61. Adding value to the Scottish sheep sector: Farm Stock (Scotland) Ltd pilot study (2013). SAC Consulting, SAOS & SMAS. https://www.sruc.ac.uk/downloads/file/1715/adding_value_to_the_scottish_sheep_sector_farm_stock_scotland_pilot_study
62. A positive value shows that demand changes in the same direction as (e.g.) price, a negative value that it changes in the opposite direction; a bigger value indicates a greater degree of responsiveness.
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