Beef industry to target high-end export market

FACED with a fall in the price of cattle, the National Beef Association has called for more effort to go into selling the higher-priced roasts and steaks on to the export market.

It believes this move will counteract the "pull-down" effect on the price of beef that the current over-reliance on the sale of mince is having.

The NBA wants this issue to be discussed by beef industry tacticians, sales promoters and commercial operators, because it is worried that current retail revenues are not generating enough money to keep processors and farmers in business

According to NBA director Kim Haywood, world and EU supplies of beef are tightening rapidly, so there must be untapped demand in Europe for cuts taken from British cattle that the mince-dominated UK market finds difficult to sell.

"Before 1996 the UK beef industry thrived on the back of a buoyant export trade but at the moment too many of the big players appear content to see burgers, mince and sausage fly off the shelves, while the appetite to re-establish compensatory sales through a resurgent export trade is disappointingly modest."

NBA inquiries reveal that many processors still think export contracts which require regular, high volume, deliveries are too difficult to secure. But the NBA noted that domestic demand for steaks and roasts is visibly dwindling, at the same time as the single European market offers trading opportunities across more than a score of countries.

"The association is convinced that without wider markets for primary cuts it will be impossible to restore much-needed carcase balance — although it would also add that an equal effort to create more retail interest in premium cuts is required on the home market too."

Meanwhile exports of the "fifth" quarter, as the tripes, sweetbreads, tongues and other parts of livestock carcasses are called, have risen dramatically.

Up until 2008, processors spent more than 2 million annually on disposing of these parts safely, but this past year, export sales of the same parts rose to 13.3m.

The turnaround has been sparked by the red meat promotional body, Quality Meat Scotland, which linked up with the Scottish Government in a 300,000 promotional exercise which is now bearing fruit.

According to Donald Biggar, the chairman of QMS, "Every part of the animal, from the most to least valuable parts, has been raised to the same world leading assurance standards, so it's a real waste for companies to be paying to dispose of parts of the animal which are recoverable and marketable.

"At a time when we are seeing a squeeze on the profit margins of our processors, it is of critical importance for companies to see where they can increase income, increase efficiency and cut costs.

"By embracing the opportunity to recover and sell fifth-quarter products, processors are gaining vital cash-flow from utilising the non-lean meat parts of the carcase. This is also saving the industry expensive disposal costs and assisting with sustainability targets."

The benefits to the processing industry were underlined by Alan Craig, president of the Scottish Association of Meat Wholesalers.

He commented: "The timing of this work could not have been better, coinciding with a period of negative returns for the meat sector when our markets have been running at extremely low levels."

"Many businesses have made significant infrastructure investments in response to a slow, but valuable, uplift in global non-carcase prices, particularly for hides.

"As a result, the losses suffered in other parts of the industry in recent months have been cushioned to a certain extent.