Roger Trewhella reports on the upbeat message delivered to UK beef farmers, once the organisation had started the process of getting its own house in order.
JEAN-PIERRE GARNIER, MLC export manager, rejected claims that he is "far too optimistic" as he reviewed the first three-week resumption of UK beef exports. The discussion between Garnier, Senor Diogo Macedo, an importing agent for UK beef in Portugal, and members attending the National Beef Association's AGM showed one of the NBA's great strengths in its ability to bring together influential players at varying levels within the industry, and always on a timely basis.
Garnier set out his four segments of the export market as cow beef, young bulls, manufacturing and high quality. Each requires a different specification and has to be targeted at the best outlet in Europe, and Garnier made a plea to abattoirs and exporters to be more focused on the weight and fat cover of beef they want to export. Early supplies had shown too great a variation to maximise value, he said.
A good start has been made with product shipped to France, Netherlands, Germany, Greece, Italy, Belgium, Portugal and Spain. Most has been cow beef with some young bulls. Interestingly it is English producers who are benefiting most from early trade. Higher quality markets, identified as Scotch or grass-fed or superior tenderness and eating quality steers, require much more marketing investment, in both time and effort, and will be slower to develop.
Live pedigree exports are anticipated for early June and it will be Switzerland that is the first third-country importer. A number of high profile events are being targeted as UK farmers are encouraged to tackle the 50,000 breeding stock exports made by The Netherlands annually. Garnier reported that 40% of current enquiries are for Aberdeen Angus breeding stock. He explained: "It is not easy for consumers to understand beef quality, and so breed is reassuring."
When questioned about the merits of marketing beef on a pure-breed basis, he replied: "Branding on the basis of a slaughter animal being 50% of one breed optimises volume while providing a situation that is defensible against other countries." As a precursor to wider live exports, Garnier believes the demand for Holstein bull calves is great from several countries and their export will underpin UK prices.
Garnier made great play of the value that can be added to the 'fifth quarter' through selective marketing. Significant interest has been received for the offal delicacies of sweetbreads, liver and hearts which, though low in volume, can generate worthwhile extra revenue for those prepared to package attractively and present the product in a tempting format. A recent survey of Italian consumers showed that English beef rated very acceptably in the Italians view of beef safety. Part of this could be attributed to the difficulty of disentangling England from the UK and its other member countries where the response was not as favourable.
Even so, for English to be rated as safer than Austrian or Swiss, for example, identifies a clear marketing opportunity. Garniers' message was clear - UK beef prices will be determined by EU levels from now on. "The party is over for UK supermarkets," he said. "Supplies will go where they give best value to the farmer and export is vital to that."
From a European perspective, UK producers have the structural advantages of larger farms able to spread overheads, which is an interesting concept when we see the fear which plagues the industry here about southern hemisphere cost of production comparisons. For the medium term the prospects for UK farming looks encouraging as it will take some years for the accessionary countries to develop their agriculture.
In the meantime production continues to decline in western Europe. Open debate This generated debate with NBA chief executive, Robert Forster, of the view that "there is no sign of UK supermarkets waking up yet." They would probably argue to the contrary as the GBR4L price averages 211p/kg compared with £2 at the end of May 2005. Soon after the market went in to freefall as increased imports combined with poor barbecue weather led to supply well ahead of demand. At the time the NBA were cited as a major contributor to the fear factor which led the multiples to increase their import orders, staving off threatened shortages of home supply.
Forster was said to be mortified by the accusations and he has certainly taken a lower profile since. At the meeting, the steadying influence of Ian Mathers came to the fore as he counselled that supply and demand will resolve the issue and the NBA should "let it be'. Ex-farm pricing, though, remains a contentious issue and the vast majority of producers will still be loosing money at current levels, especially for suckler bred cattle. The need to differentiate in the home market is every bit as important as for the export sector. At the moment producers are receiving mixed messages. For example, the interest in native breeds, especially the Angus although several are in demand, can help meet the requirement for smaller carcases.
However, cost of production will be higher and these cattle will be targeted solely at the premium end of the market. The opportunity to export beef from young bulls will not be satisfactorily achieved and on-farm weighing trials by Signet, the MLC's Performance Recording arm, and Scottish Agricultural Colleges found less difference in mature cow weights than expected between 14 breeds across the UK.MLC, and Jean-Pierre Garnier in particular, should be well placed to give a better indication about the potential volume within each export segment.
At the same time there is a need to update UK producers, and it would appear abattoirs, on developments in European market requirements. Pre-1996 European trade was based on cattle that were 'the bigger the better' - heavy cull cows, steers grown to older ages and heavy weights of 7,8,900 kgs; the alternative continental market for was young bulls, finished rapidly after weaning and at much lighter weights. Historic ties For the Portuguese market Macedo is looking for cows at 240kg carcase - well below the UK average. He was most insistent that all premium cuts sold in Portugal must fall within a 200gm weight differential. To achieve this it is critical that the live animals are also of a tight specification, equally this should ensure consistency of taste.
Macedo spoke warmly of the long historic ties between England and Portugal; like the Italian consumers surveyed, Macedo struggled to distinguish between England and the UK on occasions. With a population of 10m people the market is not large, but only 20% is home-produced and imports offering the best compromise between price and quality are sought from any source. On this tack, Macedo was very positive about the role of Brazilian imports where history between the two countries plays another big part. His objective is to promote all beef consumption and not to negatively criticise any supply.
Farmers leaving the meeting would have taken the very positive message that exports are essential to their wellbeing; that abattoirs need to be clearer about the carcase specifications they require; and that English is a brand to be proud of.