QMS reports changing balance of trade for red meat
Exports of fresh and frozen beef saw an increase of 18% from January to August this year, with sheepmeat exports up 20% year on year, according to the latest market analysis by Quality Meat Scotland.
Stuart Ashworth, QMS director of Economic Services, said that amongst all the confusion that is Brexit the first two-thirds of 2019 has been a positive period for the UK’s red meat exporters.
However, he does say that the year-on-year growth has been achieved by trading at a lower price as the value of beef exports has only grown 3% while sheepmeat exports only grew 8% by value.
“The European market still dominates with 82% of beef and 96% of sheepmeat going to Europe,” explained Ashworth. “However, the average price per tonne of beef sold to Europe was higher than the value sold outside Europe, for sheepmeat the price per tonne was little different between Europe and the rest of the world.”
UK customs data also show a decline in beef and sheepmeat imports during 2019. The volume of beef imported between January and August 2019 was 11% less than the same period in 2018 while sheepmeat imports fell 18%.
“While the average price per tonne of sheep meat imported grew 1% the beef that was imported had an average price 3% lower than in 2018,” said Ashworth. “However, the average price of fresh beef supplied by Ireland so far this year has been 5% lower than last year.
“Similar to export activity, Europe was the source of 96% of beef imports. With Ireland alone being the source of just over 80% of all beef deliveries a slightly higher proportion than in 2018.
“Nevertheless, so far this year Ireland has supplied 6% less beef to the UK than it did last year, the majority of the reduction being in frozen beef. The decline in deliveries has been higher from other countries, for example Poland have sent 13% less beef and accounts for 6% of all deliveries while deliveries form Germany and France, smaller suppliers than Poland, halved.
“Deliveries from the Netherlands, which can act as an entry point into the EU market and so supply both EU and non-EU beef fell 1%. Of the 4% of beef imported from outside the EU all suppliers with the exception of Uruguay, who supplied around 1% of imports, have reduced deliveries.”
Ashworth also confirmed that sheepmeat imports so far this year have fallen 18%. New Zealand remains the dominant supplier with 63% of this year’s deliveries coming from there. However, this is down for 66% last year as New Zealand has sent 23% less sheepmeat to the UK so far this year than it did last year with some of the shortfall being taken up by Ireland.
“Nevertheless, so far this year Ireland has supplied 6% less beef to the UK than it did last year, the majority of the reduction being in frozen beef. The decline in deliveries has been higher from other countries, for example Poland have sent 13% less beef and accounts for 6% of all deliveries while deliveries form Germany and France, smaller suppliers than Poland, halved.”
“Adjusting the volume of beef and sheepmeat produced in UK abattoirs for change in trade patterns suggests 3% less beef and 2% less sheepmeat has been available for use in the UK market so far this year,” explained Mr Ashworth. “While this may suggest that producer prices should have strengthened, the fact that export prices have reduced in an effort to balance the market by a need to increase exports points towards a very price sensitive and essentially well supplied domestic market. “