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Supermarket Power in Sheep Industry is “Fantasy”

04 June 2015

UK - Competition over product means British sheep farmers are in a fundamentally strong position, the sheep industry heard at NSA North yesterday.

Supermarket power features much more in pork and beef sectors and lamb producers should appreciate they rely on retailers less.

“The supermarkets don’t control the market,” said Norman Bagley of the Association of Independent Meat Suppliers (AIMS). “Its fantasy to think they control the sheep business”.

Norman Bagley: Unlike the pork sector, sheep farmers benefit from competition

He noted the role of the export market in offering competition for British lamb and the Halal sector in supporting cull ewe trade.

“Generally speaking, in beef we export cuts, pork we export bits, and sheep we export carcasses.

“The vast majority of Halal people are twice as big as ten years ago. If your ewe flock has stayed static – this provides a pretty good market”.

He said sheep farmers were “fundamentally very lucky” as they benefit from competition not seen in the pork market.

“You have strong competition for your product,” he added.

Looking ahead, however, he stressed markets are hard and that farmers would have to “batten down the hatches” for eighteen months to two years.

Much will rest on exchange rates and whether the sterling can fall against the euro, according to Jean-Pierre Garner, head of exports at lamb and pork levy boards EBLEX and BPEX.

He said he was positive about the strength of the UK sheep industry in general and “quite positive” about the markets outlook in the second half of 2015.

More lamb on the European market has arisen from the New Zealand drought and Spanish sales, of which much is cheap lamb, but said the issue of currency overrides these supply issues.

“We have a very strong sheep sector in the UK,” said Mr Garnier. “I travel round the EU and it is a disaster zone.”

He called for more value added cuts, rather than depending on carcasses. These can be “very up and down in trade”.

Addressing the issue of out-of-spec lambs, he said that weights and conformation are not a problem but stressed that over-fat lambs are “bad for business”.

Michael Priestley

Michael Priestley
News Team - Editor

Mainly production and market stories on ruminants sector. Works closely with sustainability consultants at FAI Farms.

Top image via Shutterstock

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