Beef and lamb outlook positive, but volatility to remain
Due to increasing global demand for meat, the outlook for the UK beef and lamb industry is positive, but volatility is here to stay, said speakers at Eblex’s annual conference.
There was a continuous theme throughout this year’s conference, with a growing world population and opportunities abroad providing a positive note, but speakers also pushed the message that volatile market forces are going nowhere, and businesses need to adapt to that.
Both Michael Sondergaard, supply chain director at Tulip Ltd, and Allan Wilkinson, head of agriculture at HSBC, explained the enormous opportunities presented by the burgeoning urban middle class in China, a country that is increasingly struggling for self-sufficency.
Sondergaard said that China’s population’s migration to cities is leading to an explosion in the size of its middle class, and thus its taste for western diets and meat. He added that by 2030, two-thirds of the world’s population classed as ‘middle class’ will be from Asia.
If the Chinese market can be opened to the UK, it was made obvious that this would be a major boost to businesses throughout the meat industry here. Wilkinson added: “I’m very optimistic, the global marketplace is very exciting.”
Eblex sector director Nick Allen told delegates: “For the rest of our lifetimes, China will be the biggest influence.”
However, speakers at the conference were keen to emphasise the need to accept that the volatility that has hurt prices in recent times, won’t go away.
Wilkinson said: “You have to manage volatility, maximise the high points, because the low points will still happen.”
Allen added: “We have a growing population that needs feeding so why aren’t we celebrating? Because of volatility - it’s here to stay. The perfect equilibrium will never materialise, we have a volatile road ahead and we have to learn to deal with it.”
Dunbia’s head of agriculture Jonathan Birnie added: “We can’t make profit all the time, we need to take a longer term view.”
Allen finished by saying that there was no silver bullet to fix the problem of volatility, but with knowledge, understanding and teamwork, it could be dealt with better by the industry going forward.
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