Scottish red meat abattoirs see turnover decline in 2016

Red meat primary processors in Scotland saw livestock numbers and figures for animals processed down year-on-year, despite a slight increase in the amount of cattle slaughtered. 

According to the latest Quality Meat Scotland (QMS) Scottish Red Meat Industry Profile, there was more stability to be found in the sector over the year. However, the warm weather and reduction in rain led to a drop in animal growth rates.

A total of 400,100 prime cattle were slaughtered at Scottish abattoirs during 2016. This was a small recovery of 0.7% from 2015, but numbers were still 13% below 2011 levels and down 22% on 2006. Mature cattle numbers drove growth, with slaughterings up 15.5% year-on-year. This led the total number of cattle killed at Scottish abattoirs and entering the food chain to increase by 2.5% to a three-year high of 471,300 head.

Sheep head numbers were also down for the year, from 3.0 million to 2.9 million. A total of 1.17m prime sheep were processed by Scottish abattoirs during 2016. This was a decrease of 11.5% from the previous year, and slaughterings fell to their lowest level since 2008. This was attributed to a lack of demand and more price sheep leaving Scotland to be slaughtered in England and Wales, with the second half of the year seeing a particularly strong level of decline (-9.5% year-on-year).

The country’s red meat abattoir sector remained static in terms of site numbers (24) however the total turnover of the primary processing sector in 2016 was £818.5m, down 4% or £36m year-on-year while the number of animals processed was down 7% to 1.9m year-on-year.

Scotland’s export market took a hit in 2016. Higher beef producer prices in Scotland than in the rest of the UK make it harder for Scottish processors to compete in price-sensitive export markets. During 2016,

Scotland is estimated to have sold £67.2m of red meat and a further £6.7m worth of offal to customers outside the UK. Beef sales are estimated at £36.5m and lamb sales at £30.7m. Total exports sales revenues of £73.9m were down by 3.5% on 2015.

Iain Macdonald of the QMS economic services team said there could be opportunities for the lamb market over the next 12 months. “The French and Spanish flocks have declined this year so there is an opportunity to get into those markets but this opportunity will be vulnerable to exchange rates.”

He added that the Scottish red meat retail market had been performing well. “There was some increase in beef sales with some passing through of prices to the producer. In terms of products, roast are difficult to sell while value added products have seen some growth.”

Stuart Ashworth, head of economics services, added communication along the supply chain was vital. steps to improve the flow of information between different parts of the supply chain will be key to unlocking future opportunities.

“A further outcome of a better flow of communication would be the forging of stronger relationships between those operating in different parts of the red meat chain,” he said. “However, it is vital that those working in the industry maintain the confidence needed to seek out the opportunities which lie ahead.”

Meanwhile QMS chairman Jim McLaren was awarded an MBE in the Queen’s Birthday Honours List for services to the farming industry in Scotland.

McLaren has held the position since 2011 and is a director of NFU Mutual and a director of Angus Cereals. He has also served on the board of SRUC (Scotland’s Rural College) and is a trustee of The Cameron Trust.

He said: “It has been a huge privilege for me to have worked in, and for, the Scottish agricultural industry in the various roles I have undertaken to date.

“I am immensely proud of our industry and particularly of the people, the length and breadth of our country, who dedicate their lives to producing safe, nutritious food in a way which enriches Scotland’s environment.

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