Meat sectors assess impact of pre-christmas travel ban
WALES’S lamb and beef sector is anxiously assessing the impact of this week’s trade disruption to crucial European markets.
Normally in December around 3,000 tonnes of sheepmeat and 1,500 tonnes of beef is exported from Wales – more than 90% of it going to the Continent.
This month’s trade alone is usually worth around £15m.
Rail, air and sea services between the UK and France restarted last weeek after France eased its travel ban. The Netherlands and Belgium, who also banned UK arrivals, will also now accept people as long as they have a recent negative result. But more than 50 other countries, including Germany and Italy, are continuing to block travellers from the UK.
At the start of last week Channel and Irish Sea ports were closed to halt the potential spread of the new Covid variant from the UK.
Data from Welsh meat body Hybu Cig Cymru (HCC) showed the industry reacted by sending fewer lambs to market.
HCC chief executive Gwyn Howells said: “December is normally a major trading month, particularly for the sheep sector with a heavy Christmas and new year export trade for both standard and light lambs. We were bracing ourselves for Brexit disruption on January 1, but the changing Covid situation brought temporary halt to most exports. Inevitably, this is a huge problem for Welsh processors who are unable to supply customers as expected.
“The numbers of livestock being brought to market by farmers has declined due to the uncertainty, and we’re monitoring the situation. The situation illustrates clearly why frictionless access to European markets is so important for the food and farming sector in Wales.”
Meanwhile, new HCC data has shed light on how the Welsh meat industry coped with this year’s Covid turbulence.
After the initial shock of lockdown, and the closure of food service outlets, the sector recovered to record consistently strong prices in the summer and autumn. By mid December, liveweight prime cattle prices were down slightly from their peak to average 211.3p/kg. But this was still 27p higher than the same period in 2019, and 19.7p above the five-year average.
Likewise, lamb prices in mid December stood at 215.2p/kg, 27.2p higher than year-earlier levels, and more than 44p higher than the five-year average.
According to HCC’S latest Market Bulletin, these shifts were caused by a “unique combination of factors”.
Domestic retail demand for beef and lamb remained strong, helping to offset some of the loss of foodservice trade, helped by fewer imports and consumers’ positive response to marketing campaigns.
Exports to the Continent recovered better than feared, as processors and exporters were able to supply Welsh Lamb quickly into European markets as they reopened. This trade was also helped by a favourable exchange rate.
These patterns are reflected in unusual throughput statistics.
UK cattle slaughterings were higher than usual between March and August, but lower at the start and end of the year due to tighter supplies.
Sheepmeat throughput reached a high peak in July. However fewer adult sheep were being slaughtered, indicating that the breeding flock is not contracting significantly despite Brexit-related uncertainty.
Pig prices have been falling steadily since their high-point in July, largely due to instability in the global market in mainland Europe and Asia related both to Covid-19 and African Swine Fever.
John Richards, HCC’S industry development manager, said the outlook for next year was very difficult to predict.
“A combination of a favourable exchange rate and our ability to respond quickly to recovering demand in Europe and the Middle East helped the Welsh Lamb sector in particular. Exports to some countries such as Italy and the UAE are actually well up on 2019.
“However the outlook for the next few months could hardly be less clear. Further lockdowns, trade disruption at ports, and the possible imposition of tariffs on trade between the UK and Europe in January are all factors which is adding to the uncertainty at present.”