Agribusiness News August 2024 – Sheep

Global Meat Outlook

The Organisation for Economic Co-operations and Development (OECD) and the Food and Agricultural Organisation of the United Nations (FAO) have recently launched their agricultural outlook 2024-2033.  The 333-page document explains projections and trends for the next 10 years for global agriculture, including enterprises such as cereals, meat, fish, cotton and sugar, to name a few.

The meat section outlines in the medium term i.e. by 2033, global meat consumption will increase by 3% or 0.50kg edible retail weight equivalent per year.  The greatest increases in meat consumption are expected to be seen in Vietnam, the United States and Brazil, which are all classed as mid income countries.  With lowering inflation rates, and cost of food reducing, these mid income countries are expected to have a quick increase in population and income, resulting in 79% of meat growth coming from these mid income countries.  High income countries which account for 32% of total global meat consumption are expected to choose quality over quantity in the coming years, with a strong emphasis on healthy living and climate awareness.  All of which are great selling points for Scotch lamb!

The Outlook report also highlights how global eating behaviours have changed since COVID, with less restaurant meals, and more home cooking due to people remote working.  Consumers are starting to make decisions based on price, health and environmental concerns.  Changes include buying cheaper cuts of meat, and a swing to eating poultry rather than red meats linked again to price and also linked to lower GHG emissions.

With this in mind, there is a massive opportunity for meat producers in the next 10 years to provide high quality protein.  For lamb producers specifically, this allows us to work on the narrative and to promote the benefits, to name just a few, of sustainability, high animal welfare and supporting biodiversity.  Whilst also working as an industry on reducing plastics in packaging, improving genetics to increase productivity and reducing food waste through utilising the full cut of meat/carcass.  However, there is a very real threat of consumption of lamb decreasing due to cost, shoppers’ perception of health awareness and environmental concerns, with as noted before, a swing towards greater poultry consumption linked to price and its lower GHG emissions.

Global GHG emissions from livestock are expected to rise by 6% by 2033.  Interestingly, the highest meat GHG emission rise is expected from Africa with 15+% increase by 2033 from the base period.  Due to increased poultry production, low carbon initiatives and higher production levels, it is thought that the percentage rise in Europe will be below 6%

Trade Back In Line

As the supply of 2024 lamb coming forward to the market speeds up, the demand has slowed down, leaving an imbalance.  This is reflected in the current domestic and European price; with domestic prices coming into line with previous years, and the French price being ~€1.60/kg DW over the UK price.  While the Australian price has recently witnessed a rise; the NZ price is deflated as countries such as China and the USA are choosing to source lamb from Australia.

	Mid July 2023	Mid July 2024	Difference
France	€ 8.17	€ 9.28	€ 1.11
Spain	€ 6.98	€ 8.15	€ 1.17
GB	€ 7.38	€ 7.68	€ 0.30
Ireland	€ 7.11	€ 7.20	€ 0.09
Australia	€ 3.31	€ 5.35	€ 2.04
New Zealand	€ 4.00	€ 3.72	(-)€0.28

Source: BordBia

Closer to Home

Current challenges in the UK flock include, a shortage of vaccines, specifically for Enzootic Abortion of Ewes, due to batch failures causing problems throughout Europe.  It is hoped stocks will return in September to allow pre tupping vaccinations.  Producers are urged to speak to their vets and to assess their biosecurity protocols for purchased stock.

Kirsten Williams; 07798617293

 

Week ending	GB deadweight (p/kg)					Scottish auction (p/kg)					Ewes (£/hd)
	16.5 – 21.5kg										Scottish
	R3L	Change on week	Diff over R2		Diff over R3H	Med.	Change on week	Diff over stan.		Diff over heavy	All
6-Jul-24	680.1	-68.4	0.6	2		320.6	-21.9	21.5	13.4		118.32
13-Jul-24	645.9	-34.2	-3.6	0.9		306.5	-14.1	8.5	0		110.43
20-Jul-24	647	1.1	-4.1	0.4		302.5	-4	7.9	-1.2		104.81