Being adaptable is key, Eblex tells industry
Meat processors need to adapt their businesses and take account of the bigger picture of supply and demand, Eblex sector director Nick Allen told the industry body’s first northern conference.
He said that demand outstripping global supply could provide some good opportunities and push up prices, but producers needed to take a longer-term view to keep the market sustainable. He said there was still significant scope for many producers to lower their production costs, which will improve both their bottom line and their carbon footprint.
He said: “We need to keep our eye on the big picture and adapt our businesses accordingly.
“We have seen this in recent weeks with the lamb price suffering, partly because of some farmers holding on to lambs for too long and putting too much weight on them to try and cash in on the higher prices. All this has done is push down prices as there is a limited market for fat lambs.
“The exchange rate is also an issue. Sterling has strengthened marginally against the euro in recent weeks, but this will not necessarily impact the export trade. Trade will continue, it is simply the money we receive for that trade that will be affected. However, we are obviously watching the euro crisis with concern and it is impossible to predict what will happen there.”
He also called for a debate on who should bear the cost of supermarket promotions, pointing out that with 50% of beef now sold as mince, much of it on promotion, this was affecting sales of other cuts.
He said: “Minced beef is very versatile, but it means many supermarkets focus on this for promotions to get customers through the door. This means that mince is often an anchor rather than a platform for other beef sales.
“A debate needs to be had on who bears the cost of these supermarket promotions – the supply chain or the supermarkets?”
Eblex’s first northern conference was held at Wetherby racecourse. Speakers included Eddie Punch, general secretary of the Irish Cattle and Sheep Farmers’ Association, Peter Mitchell, purchasing manager of McDonald’s supplier OSI Food Solutions, and Peter Morris, livestock development manager with Vion.